Best Auto Loan Rates From Top Lenders

Compare top lenders to find the best auto loan rates and terms for your needs

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LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.

How Does LendingTree Get Paid?

LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
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Written by Amanda Push | Edited by Katie Lowery and Pearly Huang | Updated March 29, 2024

Southeast Financial Credit Union logo

Southeast Financial Credit Union: Best for short-term car loans

Starting APR4.50%
Loan amountsMinimum of $12,000 for 72- and 84-month terms
Loan terms12-84 months
Min. credit scoreNot specified

  Offers a Skip-A-Payment program

  Offers joint auto loans

  Short-term loans available

  Unclear credit requirements

  Must be a member to receive loan funds

  Not many brick-and-mortar branches

See Personalized Results

Navy Federal Credit Union logo

Starting APR4.54%
Loan amountsNot specified
Loan terms36-96 months
Min. credit scoreNot specified

  Discounts for both active and retired military members

  Low starting APR

  Preapproval offer good for 90 days

  Membership restricted to those with military ties

  Doesn’t disclose available loan amounts

  No insight into credit requirements

See Personalized Offers

PenFed Credit Union logo

PenFed Credit Union: Best car loan with a car-buying service

Starting APR5.44%
Loan amountsUp to $150,000
Loan terms36-84 months
Min. credit scoreNot specified

  Offers a car-buying service

  Anyone can become a member

  Members qualify for cash-back offers

  Must be a member to receive loan funds

  Unclear eligibility requirements

  Car-buying service not available in Puerto Rico

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Bank of America logo

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

Starting APR5.99%
Loan amountsFrom $7,500
Loan terms48-72 months
Min. credit scoreNot specified

  Offered in all 50 states

  Various types of loans available, including lease buyouts

  May receive approval in 60 seconds

  High minimum loan amount

  Rate discounts limited to Preferred Rewards members

  Financing not offered for cars purchased at independent dealerships

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Capital One logo

Capital One: Best car loan for prime and subprime rates

Starting APR6.49%
Loan amountsFrom $4,000
Loan terms36-72 months
Min. credit scoreNot specified

  Competitive rates for all eligible borrowers

  24/7 access to customer service

  Option to use a co-applicant

  Financing available at over 12,000 dealerships

  Financing only available through partner dealerships

  No option for autopay discount

  Doesn’t refinance its own loans

See Personalized Results

PNC Bank logo

PNC Bank: Best for private-party car loans

Starting APR6.69% with autopay
Loan amounts$5,000-$100,000
Loan terms12-84 months
Min. credit scoreNot specified

  Financing options for private-party sales

  Flexible loan term options

  0.25% autopay discount

  Option to get short-term loans

  High minimum loan amount

  Unclear eligibility requirements

  May need to visit a PNC branch to finalize the loan

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DCU Company logo

Digital Federal Credit Union: Best for used car loans

Starting APR6.74%
Loan amountsUp to $500,000
Loan termsUp to 84 months
Min. credit scoreNot specified

  Used and new loan APRs are the same (while many other lenders charge higher APRs for used)

  Offers financing for specialty cars

  No initial payment for 60 days

  Can finance up to 130% of the car’s value or purchase price

  May have to pay an administrative fee to refinance a DCU loan

  Credit union membership is required

  Submitting loan application involves hard credit pull

See Personalized Results

Carvana logo

Carvana: Best car loan for an online experience

Starting APR6.85%
Loan amountsStarting at $5,000
Loan terms36 to 72 months
Min. credit scoreNone

  Fully online experience

  Offers loans to applicants with bad credit scores

  Seven-day return policy

  Financing offer valid for 30 days

  Loans limited to cars purchased through Carvana

  High delivery and shipping fees

  Can’t negotiate car prices

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DriveTime logo

DriveTime: Best for bad-credit borrowers

Starting APR5.90%
Loan amountsNot specified
Loan termsNot specified
Minimum credit scoreNot specified

  May approve you even if you've declared bankruptcy

  Accepts borrowers with no credit

  Fast approval decisions

  Lends to bad-credit borrowers, but does not disclose minimum credit score

  No co-signers

  Does not publish customer service hours

See Personalized Results

LightStream: Best for unsecured car loans

Starting APR7.49% (with autopay)
Loan amounts$5,000-$100,000
Loan termsVaries
Min. credit scoreNot specified

  Same-day funding

  Doesn't require collateral

  Offers 0.50% APR autopay discount

  Doesn't offer preapprovals

  Bad credit borrowers won't qualify

  Higher starting APR

See Personalized Results

Chase Bank: Best car loan for dealership purchases

Starting APRNot disclosed
Loan amountsStarting at $4,000
Loan terms12-84 months
Min. credit scoreNot specified

  Available at dealerships nationwide

  Flexible repayment terms

  Quick approval timeline

  Down payment not required

  Loans limited to partner dealerships

  Doesn't refinance auto loans

  Doesn't publish APRs

See Personalized Results

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What is an auto loan?

An auto loan is a type of loan typically secured by collateral — the vehicle you purchase — though some lenders offer unsecured auto loans. Auto loans can be used to buy a new car, refinance a current loan, buyout a lease or purchase recreational and powersport vehicles.

Auto loan lenders typically have repayment terms ranging from 36 to 84 months, though some may offer shorter or longer term limits. Keep in mind that if you default on your loan, your lender may repossess your car and your credit score will suffer.

How do auto loans work?

With an auto loan, you agree to repay a lender over a set term, typically three to six years, in exchange for them paying a dealership (or a private seller) so that you can get a car. By paying interest, your total cost of borrowing is higher than the purchase price of your car, which equates to profit for the lender. How much more you pay in interest will largely depend on your credit score.

Interest rate or APR

The interest rate on an auto loan is the percentage of the loan amount that you pay to the lender each year. It is the cost of borrowing money. The APR, or annual percentage rate, is also a percentage, but it includes the interest rate as well as other fees associated with the loan, such as origination fees and prepayment penalties. The APR is a better measure of the true cost of borrowing money than the interest rate alone, because it takes into account all of the fees that you will pay.

Auto loan rates trends: How to get a more favorable interest rate.

Since the first quarter of 2022, auto loan rates have surged dramatically. For new vehicles, rates have skyrocketed by 76%, soaring from 4.07% in early 2022 to 7.18% at the end of 2023. Similarly, the rates for used auto loans have surged by 38%, jumping from 8.62% in early 2022 to a hefty 11.93% by the end of 2023, as per Experian data.

New and used auto loan rates graph

To get the best auto loan rates:

  • Check your credit score: Lenders typically offer better rates to borrowers with higher credit scores. If you have a low score, consider taking some time to improve your credit score to qualify for more favorable rates.
  • Shop and compare: Using LendingTree’s auto loan marketplace, you can compare rates for up to five lenders at a time with just a few clicks (and no impact to your credit).
  • Consider shorter loan terms: Short-term car loans typically are rewarded with a lower interest rate.
  • Make a larger down payment: If you have the ability to, make a larger down payment as this can help you get a lower car loan rate.

How to get an auto loan

Every lender has its own approach to auto financing, but applying for a car loan commonly includes the following steps:

  1. Check your credit score. Your credit score will have a large impact on the APRs, terms and loan amounts you’ll be eligible for. It will also determine which lenders are willing to work with you. The higher your credit score, the better your chance of qualifying for an auto loan and receiving a low interest rate.
  2. Estimate your budget. You don’t want to take out a loan that you won’t be able to repay. Using an auto loan calculator can help you determine how large of a loan you can afford to take out. You can also use the 20/4/10 rule for car buying as a guideline for how much of a down payment you should provide, ideal repayment terms and how much of your budget should go toward transportation costs.
  3. Rate shop with several lenders. Getting preapproved for a car loan with multiple lenders can give you an idea of how much auto financing may cost you. It also allows you to find a loan that best fits your financial needs. Rate shopping with multiple lenders will only count as a single credit inquiry as long as you do it within 14 to 45 days.
  4. Choose a lender. After you’ve compared auto loan lenders, you’ll have to choose which one is best for you. You’ll need to close on your loan, provide a down payment and submit to a hard credit pull, which can affect your credit score.

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What should you consider when choosing an auto loan?

When evaluating auto loan offers, look at what the monthly payments mean for your budget and how much you’ll pay for the loan overall. Even if you have a low APR on a long-term auto loan, you could pay more in total interest than you would on a shorter-term loan with a higher APR.

Compare interest rates from multiple lenders to find the most competitive option. Also, be sure to determine whether each lender charges prepayment penalties, which can limit your ability to pay off the loan early or make extra payments to reduce your interest cost.

Finally, research the reputation and credibility of each lender you’re considering.

How will your credit score affect your car loan?

With a higher credit score, your total cost of borrowing will be lower. Since the lowest annual percentage rates (APRs) are offered to the borrowers with the highest credit scores, improving your credit score before applying for an auto loan can really be worth the effort.

The difference between the highest and lowest used-car APR in Q4 2023 was nearly 14 percentage points, according to Experian. On a five-year loan for $25,000, for example, borrowers with a super prime score could save almost $11,000 over the life of the loan than borrowers in the deep subprime category.

Credit scoreAverage new car APRAverage used car APR
Super prime (781-850)5.64%7.66%
Prime (661-780)7.01%9.73%
Nonprime (601-660)9.60%14.12%
Subprime (501-600)12.28%18.89%
Deep subprime (300-500)14.78%21.55%

Source: Experian State of the Automotive Finance Market report, Q4 2023

Car loans for bad credit

If you don’t have a credit history or you’ve made some credit mistakes along the way, it’s still possible to find car loans for bad credit. If you’d like to improve your chances of being approved or possibly secure a lower rate, consider adding a cosigner, making a large down payment or both.

No matter your score, it’s important to shop around for your auto loan and compare multiple offers.

Types of car loans

There are several types of auto loans, but here’s a quick rundown:

  • New auto loan: You’ve got plenty of options. Most lenders offer new car loans, including banks, credit unions, online lenders and the automakers themselves.
  • Used car loan: You’ll find used auto loans at almost all the same places. However, some lenders place limits on the age and mileage of the cars they’re willing to finance. If you want a car that’s over 10 years old or has more than 120,000 miles, you may have to get a personal loan instead.
  • Private-party car loan: Buying a used car from a person (rather than a business) requires a private-party auto loan. This type of car loan can be harder to find, but banks and credit unions still offer them.
  • Auto refinance loan: If you need a lower car payment, can qualify for a lower APR or want cash-out, an auto refinance could provide what you’re looking for.
  • Lease buyout: At the end of a car lease, you have the option to turn in the car or buy it. A lease buyout loan lets you purchase the car and continue to make payments rather than paying a large amount to buy it outright.

How we chose our picks for best auto loans

We examined closed LendingTree auto loans from H1 2023 as well as non-lender partners that offer competitive rates. We considered the following criteria:

  • 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 options for repayment terms, loan amounts and APR discounts.
  • Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that report to all major credit bureaus, offer reliable customer service and provide any unique perks to customers, like free wealth coaching.

Not all lenders we reviewed can be found on LendingTree’s loan marketplace. Capital One and Carvana are LendingTree partners. Other lenders we considered were because of their low rates and competitive loan products.

Frequently asked questions

Having a good credit score plays a big role in receiving a lender’s best APR on a car loan. According to Experian, during Q3 2023, those with the highest credit scores were offered an average APR of 5.61% for new cars and 7.43% for used. However, those with the lowest credit scores were offered average APRs of 14.18% for new cars and 21.18% for used.

Yes, you can negotiate APR. Ask the dealer to beat the auto loan preapproval rate you got directly from an auto lender. Offering a larger down payment or getting a car loan cosigner could also help reduce the APR on your loan.

The average APR for an auto loan in the first half of 2023 was 6.58% for new cars and 11.17% for used cars. To receive a lower APR than the industry average, you’ll need a credit score of at least 781 for new cars and 661 for used cars.

Automakers, credit unions, banks and online lenders could all potentially provide a low rate, but credit unions tend to offer the lowest rates. Rate shopping for auto loans within a two-week window will not hurt your credit score any more than applying to one lender. Any drop to your credit score from a credit inquiry should be slight and temporary.

While car dealerships can offer turnkey services, they also tend to charge higher rates than banks and credit unions. If you want lower rates, consider getting preapproved with an independent lender before applying for a loan at a dealership. Then you can compare the two and choose the least expensive option.

As long as you make your monthly payments on time, car financing can help to build your credit and improve your score. Keep in mind, however, auto loans can affect your credit score negatively, too, since your lender will run a hard credit pull.

December tends to be the best time of year to buy a car because of MSRP discounts. Typically, newer models are introduced toward the end of the year, so dealers may be more likely to offer discounts on older models. July to October tends to be the worst time to purchase a car.

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