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Tesla Financing Review: What You Need to Know Before Your Purchase
Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, commissioned or otherwise endorsed by any of our network partners.
Tesla Financing at a glance
Best for: Those who want to buy or lease a Tesla
Tesla Financing is available through Tesla, but the company itself is not a lender. You can apply for financing on the Tesla website as part of the car-buying/car-ordering process after you pick out or build a model. Tesla works with several lenders that provide financing on all of its existing models: 3, S, X, Y. Alternatively, you could get an auto loan directly from your bank or credit union; Tesla welcomes third-party financing.
How Tesla Financing works
Tesla serves as a loan broker and encourages customers to apply for financing online through its website. When you apply, Tesla sends your application out to its lender partners. Tesla then relays any offers back to you for approval.
There is no stated minimum required Tesla financing credit score to apply for a Tesla auto loan, but borrowers with the best credit scores (720+) generally qualify for lower-APR financing. The average credit score of a Tesla buyer in 2020 was 714.
Buying a Tesla
Tesla’s lender partners offer new and used car loans with APRs that start at 2.49% and loan terms that range from 36 to 72 months.
We recommend getting a few auto loan offers so you can compare and choose the best. The three credit bureaus allow a 14-day window of time for consumers to rate shop. It won’t hurt your credit score to apply to several lenders any more than it does to apply to one as long as you do all applications within two weeks.
Leasing a Tesla
Leasing can allow you to regularly drive a new vehicle without paying the whole price of the car. One of the best highlights of leasing is the typically low monthly payment. But there are some downsides. In a 36-month (three-year) lease, you pay for about half the vehicle’s value even though you use less than half the vehicle’s life span. Here’s more on leasing versus buying.
You may be able to lease any new Tesla model in production.
| Tesla leasing | |
| Tesla lease terms | 36-month term for Model 3 and Y
24- and 36-month terms for Model S and X |
| Tesla lease mileage | 10,000, 12,000 or 15,000 annual miles
Excess mileage can be charged up to $0.25 per mile |
| Tesla end-of-lease options | Extend the lease, trade it in, turn it in or buy it |
Tesla financing deals and rebates
Tesla doesn’t currently advertise any automaker rebates or financing deals. Federal tax incentives for purchasing an EV have expired, but you may be able to qualify for state incentives.
How to qualify for Tesla financing
To qualify for Tesla financing, you’ll need to show that you have enough income to make the loan payments. The best deals are reserved for those with high FICO credit scores. If you don’t know your credit score, you can check it on LendingTree.
When applying for a car loan, you’ll need
- Vehicle information: The year, make and model
- Personal information: Name, contact details, date of birth, Social Security number
- Residence information: Address, length of residency, whether you rent or own, what the rent or mortgage payment is
- Income information: Gross annual income, employer name and contact details
Pros and cons of Tesla financing
| Pros | Cons |
| Convenience. Applying on the Tesla website makes car shopping a one-stop shop. And by selecting your car directly on the website, you don’t have to manually enter vehicle information as you do on a third-party lender’s application. | No rebates or 0% financing. Unlike other automakers, Tesla doesn’t offer these types of deals on its inventory.
No prequalification. You don’t know what your APR will be until after Tesla’s partners do a hard credit pull. |
Alternatives to Tesla financing
We always recommend that you apply to more than one lender and that you walk into the dealership with a preapproved auto loan so you can have better negotiating power.
| Lender | Tesla Financing | Bank Of America | LightStream |
| APR | 2.49% | 4.34% | 5.49%* |
| Terms (months) | 36–72 | 12–72 | 24–84 |
*with autopay option
Bank Of America
One of the largest banks by assets in the U.S., Bank of America offers all types of car loans, including new, used, private purchase, lease buyout and refinance. And it doesn’t advertise a minimum credit score requirement.
LightStream
An online lender, LightStream offers very competitive rates. All of its loans are unsecured, so there are no restrictions on car make or model, or dealership. If you have good credit or better, a LightStream offer might be the best auto loan preapproval to take with you to the dealership. (Payment example: Monthly payments for a $10,000 loan at 3.99% APR with a term of 3 years would result in 36 monthly payments of $295.20.)
Tesla financing FAQ
Does Tesla have its own financing?
Tesla does not have its own financing company, but it works with several lenders and accepts third-party financing.
What are Tesla’s financing rates?
The lenders that Tesla works with offer rates that start at 2.49% APR.
What bank does Tesla use for financing?
Tesla does not publicly state which lenders it partners with to offer financing. You can apply directly to any lender of your choice for an auto loan and use the offer to purchase a Tesla.
Does Tesla offer 84-month financing?
No, the lenders that Tesla partners with do not offer 84-month financing. However, you could get an 84-month auto loan from another lender for your Tesla.