What is a Good Interest Rate for a Car Loan?

Signing Finance Documents for Car
 

Whether buying new or used, there’s no reason to overpay for your automotive upgrade in Gastonia. To help our Hickory customers pay a fair rate and to gain a better understanding of what is a good interest rate for a car loan, we have created a handy guide. 

Below you will find a chart that shows what is the average interest rate on a car loan and more helpful financing information. So, what is a good car loan rate? Continue reading to find out, and then apply for financing once you discover your ideal model!

 

New and Used Car APR

Average Credit Score for New Car

Annual Percentage Rate

Average Credit Score for Used Car

Annual Percentage Rate

781-850

3.17%

781-850

3.8%

661-780

4.03%

661-780

5.48%

601-660

6.79%

601-660

10.1%

501-600

10.98%

501-600

16.27%

300-500

13.76%

300-500

19.32%

How Do You Get the Best Interest Rate?

Now that we have answered, “what is a good interest rate for a car loan?” you may be wondering how to secure the best possible rate. The first thing you will need to do is plan ahead. Take a dive into your credit history and note your current score. The higher your credit score, the lower your interest rate will be on your Forest City ride. So, what is a good car loan rate? Based on the chart above, it could be anywhere between 3.17% and 13.76% depending on your credit score. 

After perusing our chart, plan for the rate you want and be prepared to negotiate. If the loan offer includes a higher interest rate than you anticipated, you can negotiate for a rate you think is fair. Be cautious about focusing too heavily on the interest rate, you want to be sure that the rest of the deal is equitable too. 

What is the Average Interest Rate on a Car Loan?

So, what is the average interest rate on a car loan? For a typical three-year car loan, the average interest rate is roughly 3% to 4.5%. This number can vary depending on your credit score and where you are applying for loans. Ultimately, the best way to ensure you are getting a fair deal is to shop around with different local lenders. 

Apply for Financing at Renaldo Kia

Now that you can answer, “what is a good car loan rate” you can shop for your next vehicle like a pro. Our Shelby finance center can help you secure a favorable deal and find your dream ride with ease. If you have any questions about interest rates or car buying, contact us today! Our team can walk you through every step of your car buying journey.

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