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Where to Find the Best Auto Loan Rates in July 2021

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When you’re financing a car, you want to find the best auto loan rates available to save money — that’s why we’ve done the legwork for you. We crunched thousands of vehicle loan applications, sorting the most frequently chosen lenders by average APR received, according to credit score. We compared those rates with the companies’ current advertised offers and those of competitors. That left us with seven companies offering the lowest rates for July 2021: three credit unions, two national banks, one online lender and an online marketplace, plus the auto manufacturers themselves. See the details about these companies in the table below.

Best auto loan rates

LenderStarting APR*Terms (months)AmountsBest For
Select Automakers0%12-84UnspecifiedNew car buyers with excellent credit
PenFed Credit Union0.99%36-84$500-$100,000Buyers who want help picking a new car
Navy Federal Credit Union1.79%12 - 96$250 min., no maxBuyers with a military affiliation
Consumers Credit Union2.24%0 - 84Up to $100,000Used car buyers
Auto Approve2.25%12 - 84UnspecifiedBuyers who want an auto refinance
Bank Of America 2.39%12-75$7,500+Buyers who prefer banks
LightStream2.49%24 - 84$5,000 - $100,000Buyers with prime credit
Capital One2.99%12 - 84$4,000+Buyers with prime or subprime credit

Get Personalized Rates


Table of Contents

Select automakers: Best for new car buyers with excellent credit

  • 0% financing
  • 12-84 months
  • Unspecified amounts

Oftentimes, the financing arms of auto manufacturers will offer special low and 0% financing deals on new cars to customers with excellent credit. It could be worth your while to apply to the automaker of the vehicle you want, but we always recommend that you come with your own auto loan preapproval.


It’s hard to beat 0% financing. You can see more here on the current 0% APR deals.


Besides the high credit requirement, these deals are only on new or CPO vehicles and automakers have model restrictions. A great APR deal may only be available on a specific model and trim during a certain time period. And deals may differ by location.

Pentagon Federal Credit Union: Best auto loan rates for a car-buying service

PenFed logo
  • 0.99% APR for vehicles purchased through PendFed’s car-buying service (1.79% APR for cars purchased independently)
  • Terms range from 36–84 months
  • Amounts range from $500–$100,000

If you would like some help finding your next car, a PenFed auto loan might be the best option for you. Pentagon Federal Credit Union teams up with AAA’s no-haggle car-buying service to help you find and get the best price on the car you want. Using the service gets you a great rate discount. And if you find a vehicle on your own, PenFed’s starting APR of 1.79% for vehicles purchased independently is not bad, either.


With the rate reduction from using the car-buying service, PenFed has the lowest advertised auto loan rate we saw from a lender that is not affiliated with an automaker. Plus, membership requirements for the credit union are lax and you can request to join even if you have no ties to the military.


The eye-catching, low APR only applies if you use the car-buying service, which not everyone might want to do.

Navy Federal Credit Union: Best auto loan rates for those with strong military connections

  • New and used car loan APRs start at 1.79%
  • Terms range from 12–96 months
  • Amounts range from $250 and up

Navy Federal has the lowest adversided auto loan APR of any of the national lenders we looked at that doesn’t require buyers to qualify for it by using another service. And that rate could go lower. For active-duty and retired military members who utilize direct deposit, Navy Federal offers a 0.25 percentage point discount, which could bring the starting APR down to 1.54%.


Besides low rates, Navy Federal’s prices for auto loan add-ons, such as GAP insurance, are also low.


Navy Federal has strict eligibility requirements. You must have ties to the U.S. military to join.


Once you’re a member or have applied to be a member, you can apply for an auto loan. It’s possible to apply online, in person or by calling Navy Federal at 888-842-6328.

Consumers Credit Union: Best auto loan rates overall

  • New car APRs start at 2.49% with the autopay option
  • Terms up to 84 months
  • Amounts up to $100,000

To become a member of Consumers Credit Union, you only need to make a one-time payment of $5 to the Consumers Cooperative Association. You do not need to have ties to the U.S. military, live in a specific geographic area or work for a certain employer.


Average APRs offered by Consumers Credit Union were among the lowest offered to borrowers of all credit levels on the LendingTree platform in Q1 2020.


The lowest rate includes a 0.50 percentage point discount, assuming you’ll make automatic payments from a Consumers Credit Union account. Your rate reduction would drop to 0.25 percentage points if you want to make automatic payments from an account at another financial institution. You could check out more credit union auto loans here.


You could apply on the Consumers Credit Union website or by calling 847-837-7938.

Auto Approve: Best for auto refinance

Auto Approve Logo
  • Car refinance APRs start at 2.25%
  • Terms range from 12–84 months
  • Unspecified amounts

Auto Approve was the most popular choice for auto loan refinance on the Lending Tree platform by far in Q1, 2021 and it averaged one of the lowest APRs on closed loans. The company does a soft credit pull to show you potential refinance offers from lenders and once you choose an offer, that lender will do a hard credit pull to produce an official offer for your approval.


Auto Approve offers lease buyouts and refinancing for motorcycles, boats, RVs and ATVs as well.


If you have a specific refinance lender in mind, such as a local credit union, apply to them directly as Auto Approve doesn’t have a public list of its lender partners.


Go to and hit the “apply” button.

Bank of America: Best auto loan rates for those who prefer a bank

  • New car loan rates start at 2.39%
  • Terms range from 12–75 months
  • Amounts start at $7,500 ($8,000 in Minnesota)

While the starting APR for a Bank of America auto loan is higher than the two credit unions above, you don’t need to qualify for membership. “B of A” offers convenience. It could be your one-stop shop with competitive auto loan rates for any type of auto loan you’d like: new, used, refinance, lease buyout and private party.


Bank of America has a variety of auto loans that you don’t always see from one lender; it has no membership requirements and it is the second-largest U.S. bank by assets.


Bank of America’s minimum loan amount is relatively high at $7,500; you could easily find a used car from a private seller for less. By comparison, Navy Federal’s minimum loan amount is $250.


You could apply for a Bank of American auto loan online or by calling 844-892-6002. If you like to do business in-person, you could schedule a visit online. Be sure to follow all COVID-19 safety precautions if you go in-person.

LightStream: Best auto loan rates for unsecured car loans

  • New and used auto loan APRs start at 2.49% with the autopay option
  • Terms range from 24–84 months
  • Amounts range from $5,000–$100,000

The online lender LightStream offers no restrictions based on vehicle age, mileage, make or model and the starting rate for new, used and refinance car loans are the same, because these loans are unsecured. While most people shy away from unsecured car loans, thinking their APR will be high, LightStream was the most popular choice on LendingTree in Q1 2021, offering one of the lowest average rates across all credit scores.


LightStream says it will beat any qualified rate by 0.10 percentage points and it has a $100 customer satisfaction guarantee, though terms apply.


LightStream heavily prefers borrowers with credit scores above FICO 660 and low debt-to-income.


The only way to apply directly is through the LightStream website.

Capital One: Best auto loan rates for prime and subprime credit

CapitalOne logo
  • New and used car APRs start at 2.99%
  • Terms range from 12–84
  • Amounts from $4,000+

On LendingTree, Capital One emerged as a favorite for people with prime and subprime credit  and it offered the lowest average auto loan rates within those score ranges.  Besides its competitive rates, Capital One offers prequalification through its Auto Navigator feature, which can give you a ballpark estimate of your auto loan without doing a hard credit pull. If you want a more solid idea of your car loan before you go to the dealer, consider getting a car loan preapproval.


Capital One covers both ends of the credit spectrum, offering competitive rates to both prime and subprime borrowers.


Capital One only offers car loans for vehicles purchased through its network of 12,000 dealerships. While that’s a lot of dealers, it’s not all of them, so Capital One auto financing might not be available at the dealership you want.


You can submit a Capital One auto loan prequalification form on its website, or visit one of its participating dealerships.

What to look for in starting auto loan rates

The best auto loan rates are typically reserved for those with the strongest credit. While there’s no set credit score required for an auto loan, manufacturers typically require a 740 or higher FICO Score to qualify for 0% APRs. Other lenders, like LightStream, look for scores in the upper 600s. The table below illustrates the average auto loan rates by borrower credit score on the LendingTree platform.

APRs for closed auto loans by credit score on the LendingTree loan platform (December 2020)
Credit Score Average APR
All borrowers 8.64%
720 or higher 4.77%
680-719 6.90%
660-679 9.95%
640-659 10.78%
620-639 13.16%
580-619 15.00%
560-579 16.42%
Less than 560 17.38%

Source: customer data

Credit scores play a large role in determining your rate, but they aren’t the only factor. Other factors include:

  • Term: In general, lenders give the best auto loan rates for the newest cars financed for the shortest terms. A long-term auto loan will typically come with a lower monthly payment, but you’ll most likely pay more in the long run thanks to higher rates and interest fees.
  • Vehicle type: Most auto loans are secured loans, meaning the car itself is the collateral. The newer the car, the easier it is to value. That’s why the loan rates for used cars are generally higher — older cars are considered less reliable and therefore riskier for lenders.
  • Lender type: Credit unions tend to offer lower APRs than banks, but each lender has its own method for setting rates. The best way to get your best auto loan rate is to shop around and compare rates from more than one lender.

FAQs about best auto loan rates

What is a good interest rate for a car loan?

The average auto loan APR was 9.46% in 2020, but it’s possible to get a lower rate. We found rates as low as 1.04% APR, but manufacturers frequently offer 0% or nearly 0% financing.

Is it better to get an auto loan from a bank or dealer?

Dealerships typically have a network of partner lenders, including banks, credit unions and financing companies. But dealers can — and often do — mark up that rate for their own profit.

The only way for you to know what rate you deserve is to get your own preapproved offers. Apply to lenders directly, or fill out a single form at LendingTree, and receive up to five auto loan offers from lenders, depending on your creditworthiness.

Can you negotiate APR on a car?

Yes. You can and should negotiate the price of your loan just as you would negotiate the price of a car.

How do I get the best APR on a car loan?

To get your best APR on a car loan, get multiple offers before you go to the dealership. If the dealer can beat your best offer, you’ll know you’re getting a fair deal.


We examined closed LendingTree auto loans from Q1 2021. We wanted to know: 1) which lenders consumers chose most often, and 2) which ones offered the lowest average APR. We also looked at the advertised starting car loan rates of large, national lenders to compare.

To find the best rates for those with military connections, we looked at rates offered by USAA Bank, Navy Federal Credit Union, Pentagon Federal Credit Union and Randolph-Brooks Federal Credit Union, and chose the one with the lowest advertised APR for a traditional new car loan not including any other discounts that may be available, such as breaks for using a car-buying service.

*May include autopay discount


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