The average APR for a car loan varies depending on several factors, including credit score, the age of the vehicle, and the lender. According to Experians State of the Automotive Finance Market report, the average auto loan interest rate for new cars in the first quarter of 2023 was 6.58%, while the average interest rate for used cars was 11.70% . However, these rates are just averages, and you might get a higher or lower rate based on several personal factors, like your lender and the age of your vehicle.
Lenders base your interest rates primarily on your credit score. According to NerdWallet, the average car loan interest rates by credit score in 2023 were as follows:
- Prime: 661-780. 6.44%. 9.06%.
- Nonprime: 601-660. 8.99%. 13.49%.
- Subprime: 501-600. 11.72%.
Bankrate provides similar information, with average auto loan interest rates by credit score as follows:
- 781 to 850: 5.07%, 7.09%
- 661 to 780: 6.44%, 9.06%
- 601 to 660: 8.99%, 13.49%
- 501 to 600: 12.17%, 18.49%
- 300 to 500: 14.88%, 20.49%
Its important to note that APR includes interest rate plus any fees charged by a lender, so when comparing loan offers, make sure you are comparing the APR. Even with a solid credit score, its wise to shop around for your auto loan and compare a few different options, as average APRs for car loans vary from lender to lender.
