As you search for your next vehicle to drive around and , you’re likely considering how to secure an auto loan with a favorable interest rate. However, it can be challenging to understand what is a good interest rate for a car loan with all the different opinions you hear. Don’t worry—the finance center at Five Star Automotive Group is here to explain everything you need to know before financing your next ride.
To understand the average interest rate on a car loan, it’s essential to look at the data based on credit scores. Here’s a breakdown for you to review:
| Avg. Credit Score for New Car | Annual Percentage Rate | Avg. 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% |
Before we explain how to get a good interest rate in Milledgeville, you first need to understand what is a good car loan rate. According to Market Watch, APRs range between 5.64% to 21.55% (March 2024). This is a good starting point that will help you know what to expect when applying for an auto loan.
Next, the most important factor in determining your unique interest rate is your credit score. The best interest rates are granted to shoppers who’ve done well with maintaining a credit profile that boasts scores in the 800 range, which can yield lower interest rates around 3.80% for used cars. So, the key to a “good” interest rate is having good credit. If your credit score falls in the non-prime range of 601-660 you can expect your interest rate to be 10.00% and above. And if your credit score is lower than 600 be prepared to pay more than 15.00%!
To ensure you’re getting what is a good interest rate for a car loan, check your credit score before applying for financing. This preparation helps avoid surprises when you visit our dealership.
The only definitive way to find out what the average interest rate on a car loan for you is by submitting a credit application. Your credit score heavily influences your interest rate, but other factors, such as the car’s value, also play a role. Lenders consider the car’s worth relative to the loan amount. A strong credit history will generally result in a lower interest rate. Meanwhile, you can use our payment calculator to estimate your potential monthly payments.
If you’re still unsure about what is a good interest rate for a car loan, contact a Five Star Automotive Group dealership near you to get in touch with a transparent and knowledgeable auto loan finance expert. Or just stop by the closest Five Star dealership and speak with a member of our finance team. While you’re here, ask about our exclusive lifetime powertrain warranty offered with new vehicles, ensuring peace of mind for as long as you own your vehicle.
Ready to trade in your current vehicle? We can help with that too! We’re only a short drive from so don’t hesitate to visit us.
