2023 Ally Bank Auto Loan Review

Ally Bank auto loans at a glance

	New and used auto loans	Refinance auto loans
Starting rates	Not disclosed	Not disclosed
Loan terms	36-75 months	36-75 months
Loan amounts	$5,000-$100,000	$5,000-$100,000
	See auto loan rates	See refinance rates

If you like ordering off the secret menu at your favorite restaurant, Ally Bank may be for you. Ally Bank is one of the largest auto lenders in the U.S., but its auto loans or leases are available only through affiliated car dealerships for the purchase of a new or used car. However, to refinance an existing car loan or buy a leased vehicle, you can apply to the bank’s online subsidiary, Ally Clearlane. Ally Bank is also an option if you’re buying vehicles for business use from a dealer.

• Indirect lending: It’s easy to find financing through Ally Bank; it partners with more than 22,000 auto dealers across the United States. But you can’t check rates or prequalify online. You’ll have to locate and visit a participating dealer in order to learn more.
• Low interest: Ally accepts manufacturers’ incentive financing promotions, so you could potentially score below-market rates.
• Flexible terms: Ally may modify payment terms if a borrower faces financial difficulties. It may lower your monthly payment amount, but to do so, the life of your loan will be extended.
• Online option: Ally’s online division, Ally Clearlane, offers auto refinancing and lease buyouts.
• Best for those with good credit: The majority of Ally auto loans go to those with a 620 or higher credit score, but Ally Bank has offered loans to those with a credit score as low as 520.

Ally Bank pros and cons

Ally Bank competes with auto manufacturers’ captive finance arms, if they have one. The APR you receive from Ally could be as low as 0% if the manufacturer is offering 0% APR car deals or low-interest promotions at the time you buy.

Because Ally auto finance offers indirect auto loans and leases only through dealers, you won’t know what APR the lender will offer before you apply. It’s smart to shop around for the best deals so you can compare offers. Use an auto loan calculator to understand your financing options.

A closer look at Ally Bank auto loans

Ally Bank offers loans and leases for new and used vehicles through dealerships. This lender works through more than 22,000 dealerships across the country and handles a large chunk of financing for General Motors and Stellantis dealers. The company’s roots go back to 1919 when it was founded as GMAC, the financing arm of General Motors. It became Ally Financial in 2010.

Since Ally is an indirect lender, you won’t know what APR you qualify for until you apply through a dealer. You can get an idea of what to expect by examining the rates below. These are the average APRs by credit band for closed auto loans on the LendingTree platform for Q3 2022.

Source: LendingTree data, Q3 2022

Ally Clearlane

If you want to refinance your car or buy your leased vehicle, consider Ally Clearlane, the bank’s direct lending arm. You can apply online for these loans. Ally Clearlane offers these types of loans everywhere except Nevada, Vermont and the District of Columbia. About 70% of loan approvals are completed through automation, but the company does consider exceptions to its usual policies.

Even if you owe more on the loan than the car is worth, it’s possible to refinance an upside down car loan.

Ally SmartLease

SmartLease is Ally’s primary leasing option, which you can use to lease new cars. It will automatically come with Guaranteed Auto Protection (GAP). You’ll have the choice between a single-pay lease, where you’ll make one large payment upfront, or traditional monthly payments. The advantage of leasing is that you typically make smaller monthly payments than you would buying. The drawback, of course, is that when the lease ends, you’ll either have to turn in the vehicle or buy it.

How to get a loan with Ally Bank

Ally Bank is different from other auto loan lenders because you can’t apply directly for a new or used auto loan. Instead, you have to apply at a dealership. Before you head to the dealership, here’s what you need to know about Ally financing.

First, get an auto loan preapproval from other lenders to compare against what you receive from Ally Bank. Once you have a car loan offer in hand, you can take the next steps:

1. Find a participating dealership using Ally’s dealer locator tool.
2. Gather any documents and information you may need — use this car loan documentation list.
3. Pick out a car and fill out a credit application at the dealership. Dealers may pick and choose where to submit your loan application, so tell them you want to see an offer from Ally Bank. Compare that offer with your preappoved auto loan offers to select the best option.

How Ally Bank auto loans compare

You’ll have to submit an application to a dealer to get a sense of how Ally Bank compares with other lenders. Reviewing offers from other lenders, such as PenFed Credit Union or Bank of America, will help you understand whether a loan offer from Ally is best for you.

Is an Ally Bank loan right for you?

An Ally Bank auto loan may be a good fit if you want to manage financing through the dealership. They will handle the application and loan processing for you. However, Ally Bank makes it difficult to shop around for new and used car loan rates, so do your research to make sure you’re getting a loan deal that works for you.

You could fill out a single form at LendingTree and receive up to five loan offers from lenders, depending on your creditworthiness. This way, you’ll already know your options when you get to the dealership and can take the loan with the lowest APR or the one that best fits your budget.