Auto loan interest rates in August 2022
Car loan interest rates change frequently, so it’s important to keep track of them. Your loan’s interest rate influences how much you’re going to pay each month. And a lower interest rate can mean thousands of dollars in savings. Our rate table can help you know the best time to buy a new or used car.
What’s the best credit score for a low-interest loan?
Credit scores of 740 or higher — what’s considered very good — will help you qualify for the lowest auto loan interest rates. But even if your credit score is lower, you may still qualify for a decent rate.
How can I get the best car loan interest rate?
Borrowers with a lower credit score may see higher auto interest rates. If your credit score is on the lower end — 580 or lower — some lenders may offer higher interest rates or longer loan terms, which can be a risk. Taking steps to improve your credit score can go a long way toward getting a better interest rate and saving you hundreds or thousands of dollars if you are not in a rush to purchase a vehicle.
What’s the difference between new and used car interest rates?
Loans for newer cars tend to have lower interest rates than those for used cars. Lenders see newer cars as less of a risk — they’re less likely to break down and lenders can identify exactly how much they’ll depreciate over time. Newer cars also have more predictable resale value than older cars, and that predictability results in a lower interest rate.
What are other important car ownership costs to consider?
Beyond the cost of monthly car loan payments, vehicle ownership costs can add up.
Car insurance is one of the more significant costs that come with owning a vehicle. Make sure you understand car insurance rates and the best car insurance companies available in order to select the best car insurance coverage for your needs.
Also, consider maintenance and repair costs, which can start at around $100 per visit but vary by the make and model of your vehicle. Use Edmund’s car maintenance calculator to get an estimate of how much you’ll spend to maintain your vehicle.
Fuel expenses are another cost to keep in mind as you search for a new vehicle. If you’re unsure of how much to budget, visit FuelEconomy.gov to view the fuel economy or gas mileage and projected annual fuel costs for the year for the make and model of the vehicle you select.
There are also registration fees, documentation fees and taxes that you’ll pay when you purchase the car. You’ll also pay to renew your registration every one, two or three years. Renewal fees and cycles vary by state.
Estimate your monthly payments with Bankrate’s auto loan calculator.