This Is the Average Auto Loan Interest Rate by Credit Score

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  • Consumer loan interest rates are much higher than they were a year or two ago, and auto loan interest rates have risen significantly.
  • However, good credit can still save you a lot of money when you finance your next vehicle.

Interest rates have gone up, so here's what to expect when you buy a car.

As you probably know, interest rates have risen rapidly and it now costs more to finance major purchases. However, while auto loan interest rates are much higher than they were a year or two ago, having good credit still makes a tremendous difference in your cost of borrowing money. Here's a look at the average auto loan interest rates by credit score as of April 2023, and some steps you can take to get the lowest interest rate you can.

Average new car loan interest rates

Consumer interest rates on everything from mortgages to credit cards have risen significantly over the past year or so, and auto loans are no exception. The days of 3%-4% APRs on auto loans are gone, at least for now. According to myFICO, which is operated by the same company behind the widely used FICO credit scoring methodology, these are the average APRs consumers are getting on 60-month new auto loans today:

FICO® Score Range Average APR Monthly Payment on 60-Month $35,000 New Car Loan
720-850 6.909% $692
690-719 8.02% $710
660-689 9.678% $738
620-659 11.881% $776
590-619 16.137% $854
500-589 16.944% $869
Data source:

As you can see, your credit score can make a significant difference in the amount you're paying for a car. And keep in mind that it isn't just the difference in monthly payment -- it can add up to more than you think over the term of a loan. As an example, a consumer with a 670 FICO® Score can expect to pay $1,680 in additional interest over a five-year loan.

Average used car loan interest rates

One thing buyers often find surprising is that used car loans typically have higher interest rates than new car loans, all other factors being equal. There are a few good reasons for this -- most importantly, a used car represents a higher risk to a lender because the vehicle's condition is less predictable at the time of purchase, relative to a new car. Plus, you can typically find longer loan terms on new cars, due to their longer expected life span.

With that in mind, here are the average interest rates on a 48-month used car loan as of April 4, 2023:

FICO® Score Range Average APR Monthly Payment on 48-Month $35,000 Used Car Loan
720-850 7.351% $844
690-719 8.563% $864
660-689 10.488% $896
620-659 11.688% $916
590-619 17.422% $1,018
500-589 18.578% $1,039
Data source:

How to save money on your next auto loan

When interest rates were low, figuring out how to save on an auto loan was low on many buyers' list of concerns, but now it can be far more important. For one thing, many manufacturers are still offering promotional financing deals. It isn't quite as common to find 0% APR financing, but it's still out there for many models.

It's also more important to shop around for an auto loan these days. It's a fairly quick process to fill out a pre-approval application with most lenders, and you might be surprised at the difference in interest rates that the same borrower can get from two different lenders. Plus, you can apply to as many lenders as you'd like without an adverse impact to your credit score -- as long as all of the applications take place during a two-week shopping period, it will count as a single credit inquiry.

Finally, if you don't need to buy a car immediately, it could be worthwhile to try and boost your credit score. Truly great credit takes years to build, but you might be surprised at how much of an impact you can have with a few months of smart strategizing. And the difference in moving up just one credit tier can save you thousands of dollars.

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