Best Auto Loan Rates in November 2024

Compare car loans from multiple lenders to find the best rate

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Southeast Financial Credit Union (SFCU): Best for short-term car loans with cheap rates

4.25%

12-84 months

Not specified

Pros
  • Competitive rates for short loan terms
  • Recent college grads may be eligible for a car loan even if they have no credit
  • Can apply to skip a payment if you need extra time
Cons
  • Have to become a member to borrow
  • Can’t check rates without hurting your credit
  • Not many branch locations

What to know

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Credit union car loans tend to offer the lowest rates, and SFCU is no exception. Its rates are especially low on short-term car loans. At 4.25%, rates on 12-month terms are twice as cheap as they are on SFCU’s 84-month terms.

If you like to do business in person, though, SFCU might not be the best choice. That is, unless you live in central Tennessee. That’s where all of SFCU’s brick-and-mortar branches are located.

How to qualify

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SFCU doesn’t offer prequalification so you’ll need to agree to a hard credit hit to see if you’re eligible. You also need to join the credit union before you can borrow.

All SFCU members must open a savings account with a deposit of at least $5. To become a member, you must meet one of the requirements below:

  • Make a $5 donation to Autism Tennessee
  • Be a current employee or retiree of a Southeast Financial Select Employee Group
  • Be related to a current SFCU member
  • Live, work, worship or go to school in certain parts of Tenn., Ky., or Miss.

PenFed Credit Union: Best for car shopping and comparing sticker prices

4.44%

36-84 months

Up to $150,000

Pros
  • Free car-buying service can help you compare cars from dealerships near you
  • Cheaper rates if you use car-buying service
  • Can finance up to 25% more than what the car is worth for cash in your pocket
Cons
  • Have to join credit union (but membership is open to all)
  • Must use car-buying service to get PenFed’s lowest rates
  • Can only get your loan as a check in the mail (direct deposit not available)

What to know

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If you want to compare car prices and get a low rate on an auto loan in one step, PenFed might be for you.

By using its free car-buying service PenFed will give you a reduced rate, starting at 4.44%. And thanks to a partnership with TrueCar, it can help you find your next ride at a price you can afford. The service also runs special offers (such as bonus cash) on select car purchases.

Like with any credit union auto loan, PenFed requires you to join before you can borrow. Still, it’s easy to join since membership is open to everyone. Also, note that PenFed’s new car auto loan rates start at 5.24% if you don’t use its car-buying service.

How to qualify

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Some credit unions only extend membership to certain groups (Navy Federal’s military requirement, for instance). That’s not true for PenFed. Although PenFed is short for Pentagon Federal Credit Union, its membership is open to everyone. All you have to do is open an account with a $5 deposit and you can apply for a loan.

Bank of America: Best car loan for those who prefer big banks

5.69%

48-72 months

Starting at $7,500

Pros
  • Mobile-friendly application
  • Don’t have to be a Bank of America customer to be eligible
  • No loan documentation fees
Cons
  • Only gives rate discounts to current members
  • Can’t buy from an independent dealer
  • A cheaper used car might be off the table since you have to take out a loan for at least $7,500

What to know

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Auto financing from a big bank can have its perks. Compared to small, regional banks, large banks tend to have more digital presence. Case in point — Bank of America has an auto loan application that’s specifically designed for mobile. It also offers car loans nationwide.

Bank of America auto loans are open to anyone, but only Preferred Rewards members qualify for APR discounts. To be a Preferred Rewards member, you must have an eligible Bank of America account with a starting balance of $20,000.

How to qualify

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To get a Bank of America auto loan, the car you’re buying must:

  • Be less than 10 years old
  • Have less than 125,000 miles
  • Be worth at least $6,000
  • Be for personal use only
  • Not be a commercial, heavy-duty truck or van
  • Not have a salvage or branded title

Digital Federal Credit Union (DCU): Best for used car loans

5.74% (with direct deposit discount)

Up to 84 months

Up to 130% of the car’s value

Pros
  • Same rates for used and new cars
  • Can borrow up to 30% more than the vehicle’s value
  • Special discounts for electric cars
Cons
  • Must join credit union
  • Customer service not available on Sundays
  • Can’t check rates without hurting your credit

What to know

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Most lenders charge a higher APR on used car loans, but not DCU. Whether you’re buying used or new, you can enjoy the same low rate. If you have excellent credit, you might be able to borrow more than what the car is worth. This could help you cover registration and insurance costs.

Like other credit unions, though, you have to become a member to borrow. You must also take a hard credit pull to check your eligibility since you can’t prequalify.

How to qualify

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People in the below groups can join DCU:

  • Certain relatives of current DCU members
  • Employees and retirees of participating employers
  • Members of participating organizations
  • Those who live, work, worship or go to school in certain Massachusetts communities
  • People who live in a participating condo association

Capital One: Best car loan overall

(4,087)
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(4,087)
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6.09%

36-72 months

Starting at $4,000

Pros
  • Competitive rates, regardless of credit score
  • Can get prequalified or preapproved — it’s your choice
  • Auto Navigator tool can help you find your next car and stick within your budget
Cons
  • Can only buy from certain dealerships
  • No customer service on Sundays
  • No interest rate discounts

What to know

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We chose Capital One for best overall car loan for several reasons. For one, it offers car loans to both good and bad-credit borrowers. While Capital One doesn’t share its minimum credit score requirement, according to LendingTree data, it may approve you with a score as low as 530. And if you have exceptional credit (800+), you could get a competitive rate of 6.09%.

With both prequalification and preapproved car loans, Capital One has options no matter where you are in the car-buying process. Prequalification is less exact, but it doesn’t hurt your credit. Preapproved car loans are more accurate but require a hard credit pull.

That said, Capital One won’t finance a vehicle purchase from just anywhere — you have to buy from a partner dealer.

How to qualify

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You could be eligible for a car loan through Capital One as long as you have a credit score of at least 530. You can prequalify on Capital One’s website to get an idea of where you stand.

LightStream: Best quick car loan

(478)
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(478)
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7.24% (with autopay)

24-84 months

Loan Term Disclosure

Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay are 0.50% points higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice. Payment example: Monthly payments for a $25,000 loan at 7.49% APR with a term of 3 years would result in 36 monthly payments of $777.54. © 2024 Truist Financial Corporation. Truist, LightStream and the LightStream logo are service marks of Truist Financial Corporation. All other trademarks are the property of their respective owners. Lending services provided by Truist Bank.

$5,000-$100,000

Pros
  • Same-day car loans are possible
  • No restrictions on year, make, model or mileage
  • Does not require a down payment
Cons
  • Must have good to excellent credit to qualify
  • Can’t check rates without hurting your credit
  • Higher rates than most traditional auto loans since you aren’t using your car as collateral

What to know

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With some lenders, you’ll need to wait for your loan check to come in the mail. Not with LightStream.

As long as LightStream approves you by 2:30 p.m. EST on a business day, you could get your money on the same day that you applied. LightStream also doesn’t require appraisals and it doesn’t have any vehicle restrictions.

However, LightStream auto loans are unsecured. This means it doesn’t use your car as collateral (as is the case on a traditional auto loan). In trade, LightStream’s rates are a little higher than others on this list. Collateral loans typically come with cheaper rates because they are less risky for the lender.

How to qualify

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LightStream states it only lends to borrowers with good to excellent credit. Below you’ll find some metrics that LightStream says it looks for in approved borrowers:

  • At least five years of credit history, with a diverse mix of accounts
  • Assets such as retirement savings, investment accounts and liquid bank accounts
  • An acceptable DTI ratio
  • A track record of making debt payments on time

Carvana: Best car loan for an online experience

(1,500)
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(1,500)
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7.90%

36-78 months

Starting at $1,000

Pros
  • Fully online car-buying experience
  • Can request to have your car delivered to you instead of picking it up
  • No minimum credit score requirement
Cons
  • Must buy your car through Carvana
  • Not available in all states
  • Can't negotiate car prices

What to know

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Carvana’s unique online car-buying experience could be a great choice for the right person. Just hop onto Carvana’s website, find your desired car and apply for financing — all without leaving your home.

Still, not everyone will feel comfortable buying a car online. Carvana has a seven-day satisfaction guarantee, but you can’t check out the car in person before buying. Also, it’s important to know that Carvana has been the target of several lawsuits, namely due to tag and titling issues.

How to qualify

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Compared to some lenders, Carvana’s eligibility requirements are transparent and easy to meet. To borrow, you must:

  • Be at least 18 (19 in Alabama and Georgia)
  • Have no active bankruptcies
  • Make at least $5,100 a year

PNC Bank: Best for private-party car loans

8.49% (with autopay)

12 - 84 months

$5,000-$100,000

Pros
  • May give you extra time to pay or allow you to make partial payments if you’re experiencing a financial hardship
  • Can use a private-party auto loan to buy a car that’s not fully paid off by the current owner
  • Rate discount for autopay through a PNC checking account
Cons
  • Can only apply for a private-party auto loan in person at a branch
  • Only available in 28 states and the District of Columbia
  • Must be buying a car that’s worth at least $5,000

What to know

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Buying a car from a private party instead of a dealership can save you money, but not all lenders fund these types of purchases. PNC might help.

This bank offers several types of loans, including private-party car loans. You might even be able to buy a car that isn’t yet fully paid off. As long as the seller comes with you to your loan closing, PNC can use a portion of your loan to pay off the existing loan. Then, you can transfer ownership.

How to qualify

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PNC Bank doesn’t offer prequalification. If you want to check rates, you’ll have to take a hard credit hit.

You can formally apply online for most of PNC’s auto loans. However, if you’re getting a private-party auto loan, you need to go to a branch. Either way, you don’t need to be a PNC member to borrow.

Autopay: Best bad-credit car loan

(329)
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Not specified

24 - 96 months

$2,500-$100,000

Pros
  • Can qualify with a credit score as low as 550
  • Able to check rates without hurting credit
  • Works with a large network of lenders
Cons
  • Must prequalify to see what kind of rates Autopay offers
  • No mobile app
  • Won’t know what fees apply until you know what lender you’re going with

What to know

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Applying for auto financing when you have less-than-perfect credit can be a pain. Autopay is an auto loan marketplace that can make the process easier. Fill out one quick form online and you could have multiple offers to compare, all with no impact to your credit score. Better yet, it works with borrowers with as low as 550.

Since Autopay doesn’t specify APRs, you’ll need to prequalify to see what kind of rates you might get from its partners. Associated fees can also be hard to budget for since they vary by lender.

How to qualify

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Autopay is a loan marketplace that connects borrowers to partner lenders and financial institutions. These partners all have different eligibility requirements.

To use the marketplace, you must have a credit score of at least 550 and make $2,500 per month. Your vehicle must be less than 10 years old and have no more than 150,000 miles on it. From there, you can prequalify to see what lenders you might be eligible for.

Chase Bank: Best for dealerships in the Chase network

Not specified

12-84 months

Starting at $4,000

Pros
  • Can check rates without hurting your credit
  • Sends your loan approval directly to the dealer on your behalf
  • Chase Private Client members get a 0.25% rate discount
Cons
  • Can only be used at partner dealerships
  • Impossible to know what rates Chase offers without prequalifying
  • Need to know what car you want to buy when applying

What to know

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Chase Bank can make it easy to buy a car from a partner lender near you. Just get prequalified online. After, it will send your prequalification offer directly to the dealer so you don’t have to mess with paperwork. Plus, Chase doesn’t require a down payment and you don’t need to know exactly what car you want before prequalifying.

Unfortunately, you can’t use Chase at all car dealers. It has to be a part of the Chase network. The good news is that Chase partners with thousands of dealers countrywide. But because it doesn’t advertise its rates, you must prequalify to see what APRs it offers.

How to qualify

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To get an auto financing with Chase, the car you’re buying must:

  • Be less than 10 years old (or less than five years old, if a Tesla)
  • Have less than 120,000 miles
  • Not be commercial vehicles
  • Not have branded or salvaged titles
  • Not be used for ridesharing

You don’t need to be a current Chase customer to get an auto loan.

How does an auto loan work?

On the surface, auto financing is simple.

You don’t have to pay in full when you buy a car if you finance. Instead, you’ll use an auto loan. Then, you’ll pay off what you borrowed in monthly payments, plus interest and fees. You may or may not need to pay a down payment, but you probably should (more on that later).

Although you are the registered owner while you’re making loan payments, the car technically belongs to your lienholder. This is the company that gave you your loan.

If you have a secured auto loan (the most common kind), your car serves as collateral. That means your lienholder can — and likely will — repossess your car if you fall too far behind on your payments.

When you’ve paid the loan in full, the lienholder will release the car’s title to you. At that point, it officially becomes your property.

Types of car loans

All auto loans essentially do the same thing — help you pay for a car via monthly payments. Still, you should familiarize yourself with the different types of auto loans so you know which one to shop for.

  • New auto loan: New car loans tend to have the lowest rates. Many banks, credit unions and online lenders offer loans for new cars. In some cases, you could even get a loan from your vehicle’s manufacturer (such as Toyota Motor Credit).
  • Used auto loan: Used auto loans usually have slightly higher rates than new car loans. Also, some lenders have rules about the vehicles they will finance. For instance, some won’t finance a vehicle that is 10 years old or older.
  • Private-party auto loan: Financing a car from a person instead of a dealership requires a private-party auto loan. These loans can be harder to find, but you may have luck searching with banks and credit unions.
  • Auto refinance loan: Refinancing an auto loan means you’re replacing your current loan with a new one (hopefully with better terms). Refinancing can be a good idea if rates have dropped since you bought your car or if you’ve improved your credit score.
  • Lease buyout: Instead of turning in your lease at the end of your contract, you could choose to buy the car with a lease buyout loan.
  • Cash-out refinance loan: A cash-out refinance auto loan is a refinance loan that also lets you borrow cash against your vehicle’s equity. Equity is what you’ve already paid toward your car.

Auto loan pros and cons

Whether you’re looking for the car of your dreams or something to get you from A to B, a loan can help. At the same time, unless you pay off your car loan early, you could be saddled with debt for years. Take a look at the pros and cons before signing on the dotted line.

ProsCons

 Won’t need to come up the entire cost of the car up front to buy it

 Could help you afford a more reliable car

 On-time payments should help you build credit and improve your score

 Will pay interest and possible fees

 Won’t own the car until you’ve paid it off in full

 Your car insurance may go up

 Late payments will hurt your credit score

How your credit score impacts auto financing rates

Your credit score plays a major role in your auto loan APR. Statistically, borrowers with higher credit scores are less likely to default on their loans. In turn, lenders grant these borrowers lower financing rates to entice their business.

In the table below, you’ll find the average APR for new and used cars in the second quarter of 2024. Notice the spread between super prime and deep subprime borrowers — especially on used car loans.

To illustrate, a super prime borrower would pay $2,876 in total interest on a 60-month $25,000 used car loan. A deep subprime borrower, on the other hand, would pay $9,627.

Car loan rates by credit score

Credit scoreAverage new car APRAverage used car APR
Super prime (781-850)5.25%7.13%
Prime (661-780)6.87%9.36%
Nonprime (601-660)9.83%13.92%
Subprime (501-600)13.18%18.86%
Deep subprime (300-500)15.77%21.55%

Source: Experian’s State of the Automotive Finance Market Q2 2024

Can I get auto financing with bad credit?

The credit score needed to get a car loan varies. Some lenders only work with those with good credit or better. Others don’t have a minimum credit score requirement at all.

If your score is below 661, you might want to explore bad credit car loans. A score of 661 is the cutoff between “prime” and “nonprime,” according to Experian.

Some other ways to boost your chances of approval include:

Adding a cosigner or co-borrower: Adding a cosigner to your auto loan might be what you need for approval. Know, though, that late payments will affect that person’s credit as well as yours.

Making a large down payment: The less you have to borrow, the more likely a lender may be to approve you.

Expert insights on auto loan rates

Photo of Jacob Channel
Jacob Channel, Senior economist

Remember that the Fed doesn’t directly set auto loan rates. The exact rate you get on a car loan will depend on factors such as your credit score and debt-to-income ratio.”” 

Jacob suspects that auto loan rates will trend down in 2025 because of Fed rate cuts, but it’s not guaranteed. Even if the Fed continues to slash rates, it’s better to focus on improving your credit and shopping around. These are things you can control and if rates drop dramatically in the future, you can think about refinancing.

How to get a better auto financing rate

Auto financing rates depend on your credit score, the car you’re buying, the amount of your down payment and more. For comparison’s sake, the average rate for a new car loan was 6.84% as of the second quarter of 2024. For used cars, the average was 12.01%.

Improving your credit score isn’t the only way to get a better car loan rate. You could also:

Check your credit report

Order your free credit report and check for errors. Disputing credit report errors can give your score a lift. Some common errors to look for include mistakes in your personal information, account statuses and debt balances.

Make a down payment

Not all auto loans require a down payment. Even so, it may be a good idea to make one anyway.

Putting money down takes some of the lender’s risk and transfers it to you. After all, you’ll lose your down payment if the lender repossesses your car. As a result, a down payment can help you secure a better rate.

Pick a short loan term

Cars are getting more expensive, so 84-month car loans are increasingly popular. That’s because longer terms usually mean lower monthly payments. However, longer terms also almost always carry higher rates.

Buy your car during the holidays

Captive financing is when you get your car loan straight from your car’s manufacturer. Around the holidays, these manufacturers typically offer 0% APR car deals on certain years, makes and models.

 Don’t forget about insurance!

It can be easy to get swept up in the excitement that comes with buying a new car. But one of the most overlooked expenses is insurance. Lenders typically require full coverage (or, comprehensive and collision) with maximum deductibles of $500 or $1,000.

Make sure to get an insurance quote and factor your updated premium into your car-buying budget. While you’re at it, consider shopping around. Major life events like buying a new car, moving or getting married are a great time to compare insurance companies.

See how much you can save today!

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How to compare auto loans with LendingTree

  1. Check your credit score. Before shopping for an auto loan, get your free credit score with LendingTree Spring. Use this info to better understand if your offers are competitive. You may also want to take some time to improve your credit score before buying so you can get a cheaper rate.
  2. Tell us what you’re looking for. Consider LendingTree your personal loan shopper. With just one quick form, you can compare rates on the nation’s largest network of lenders. Our service is totally free and when banks compete, you win.
  3. Formally apply. With LendingTree, you could have multiple offers from up to five lenders. If you find a loan that fits your budget (consider the 20/4/10 car-buying rule), we’ll help you take the next steps to submit your formal application.
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How to compare auto loans

 APR: An annual percentage rate (APR) measures the total cost of your loan, including interest and fees. The lower your APR, the cheaper your loan.

 Loan amount: Unless you’re buying a luxury car, you probably won’t need to worry about maximum loan amounts. But if you want to finance a cheaper used car, not all lenders can accommodate. Most auto loan amounts start at several thousand dollars.

 Financing term: Your financing term is the length of time you have to pay off your loan. Terms between 12 and 84 months are the most common. The longer your term, the lower your monthly payment usually is. On the flip side, a long term could mean more interest over the life of the loan.

 Fees: Buying a car can come with mandatory fees, such as taxes, titling and registration. Some dealer fees are optional, like those associated with protection packages and extended warranties. Always ask for the out-the-door price, and don’t be afraid to turn down options that you aren’t interested in.

 Lender reputation: The CFPB maintains a database of customer complaints toward lenders. Check it, along with LendingTree lender reviews, to make sure the lender you choose has your best interest in mind.

 Unique features: Outside of cheap rates, think about what is important to you in an auto loan. Perhaps you prefer to pay by using a mobile app. Or maybe you need some help with car shopping and are interested in a car-buying service. Then, seek out lenders that offer those perks.

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How we chose our picks for best auto loans

We reviewed 25 auto lenders to determine the overall best 11 auto loan lenders. To make our list, lenders must offer auto loans with competitive APRs. From there, we prioritized the following factors:

  • Accessibility: We chose lenders with auto loans that are available to more people and require fewer conditions. This may include lower credit requirements, wider geographic availability, faster funding and easier and more transparent prequalification, preapproval and application processes.
  • Rates and terms: We prioritize lenders with more competitive starting fixed rates, fewer fees and greater loan options for repayment terms, amounts and APR discounts.
  • Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that have self-service payment options (such as a mobile app), provide reliable customer service and offer unique perks.

Not all lenders we reviewed can be found on LendingTree’s loan marketplace, and your offers may or may not include lenders on this list. Our goal is to give you accurate, helpful information so you can find the best auto loan for your unique financial situation.

Frequently asked questions

Generally, the best place to finance a car is with the lender that offers you the lowest rates. The only way to truly know if a lender is giving you the most competitive rate is to shop around.
 

Your auto loan interest rate will largely depend on your credit score. In other words, a good auto loan interest for you might not be for someone else.
 
According to a LendingTree study, the average FICO credit score in America is 715 (at the time of this writing). Someone with a 715 score is considered to be “prime.” In the second quarter of 2024, the average prime rate on a new car loan was 6.87%. For used car loans, it was 9.36%.

Shorter loan terms typically carry the lowest rates. At the same time, a shorter term can cause a higher monthly payment (since you’ll have less time to spread your balance across). Use our auto loan calculator to see how different term lengths can impact your monthly payment.

Remember that although your credit score plays a big role in your car loan rates, lenders look at other factors, too. These typically include your income, repayment term, borrowing history, employment history and more.
 
That said, the average rate on a new car loan for someone with an 800 credit score (super prime) is 5.25%. For used cars, the average rate is 7.13%.

Many people opt for a longer loan term because they typically come with a lower monthly payment. That’s because you have more time to spread your balance across.
 
However, the longer your loan term, the more overall interest you’ll pay. Also, loans with longer repayment terms generally have higher rates than shorter ones. The longer you have an outstanding balance, the higher the risk is for the lender (you’ll have more time to fall behind).