Lenders are competitive by offering low-interest rates to borrowers they believe to be reliable. The best auto lender loan rates for new vehicles are 2.5% and below. Many providers, including banks and credit unions, offer these competitive rates.
- Compare quotes from several auto lenders to get the best auto loan rate. PenFed Credit Union is the top-rated auto lender institution with an annual percentage rating of 1.04%.
- The interest rates are generally lower for shorter loan terms, typically between 24 and 36 months.
Comparing prequalification offers from multiple top lenders is smart when shopping for auto loans. This article will discuss the top five providers of low auto loan rates. We also explain how to find financing options through various loan terms.
Five Providers with the Best Auto Loan Rates
Our research shows that PenFed Credit Union offers the lowest annual percentage rate (APR), at 1.04%. Bank of America, myAutoloan.com, and Bank of America offer the best loan terms and financing options.
Interest rates can change often. The best auto loan borrowers will get the lowest rates. The minimum credit score requirement needed to be approved for auto financing from auto loan lenders differs from the minimum to obtain the lowest interest rate. All information is correct at the time it was published.
PenFed Credit Union
PenFed Credit Union offers one of the most affordable annual percentage rates among banks, credit unions, and loan offers companies. Although the advertised rate is 1.04%, getting rates this low is impossible due to the minimum credit score requirement.
PenFed’s car-buying service allows you to purchase a vehicle for a 36-month term. This rate applies to all customers. PenFed Credit Union partners with TrueCar to provide vehicle listings in your area. The low APR makes this an attractive option for auto loan borrowers.
The buying service is required to get a used car loan. Lender rates for vehicles purchased without this buying service start at 1.79%. Otherwise, the rates are 2.39% and 1.64%, respectively.
These rates are still among the most competitive compared to other online lenders’ rates for used and new vehicles. PenFed Credit Union membership requires a deposit. A variety of organizations allow you to become a member.
Bank of America
Bank of America offers a new vehicle loan APR of 2.399% for borrowers with good credit. This is 10% lower than other auto loan offers. Refinance loans are available for existing loans at 3.39%. The average rate for used cars rates starts from 2.59%. Bank of America, Preferred Rewards members can receive a 0.5% interest rate discount.
Bank of America is a national bank that works with many dealerships nationwide. This means you have many options when using their auto loan calculator to find the best deal for your needs. However, there are limitations, as Bank of America will not finance more than 125,000 miles on the odometer or older than ten years.
They also have certain restrictions on auto loan types. Bank of America will only finance vehicles at least $6,000 or alternative vehicles such as motorcycles and RVs.
MyAutoloan.com
MyAutoloan.com, an internet-based lender, has been in existence since 2003. It offers rates starting at 2.49%. Over 700 Trustpilot customers have rated the company 4.3 out of 5 stars. The company also has an A+ rating and Better Business Bureau (BBB) accreditation.
To qualify, borrowers must have a minimum credit score of 575. MyAutoloan has a lower Credit requirement than many top lenders, making it an excellent option for those with poor credit who need a car loan with bad credit.
What sets MyAutoloan apart from other companies is its online application process and marketplace that allows you to compare offers from lenders.
To find the best auto loan rates, using myAutoloan is a good idea, and you can save time by doing so. MyAutoloan provides consumers with a convenient way to compare average auto loan rates from multiple lenders. MyAutoloan requires that you borrow at least $8,000
Consumers Credit Union
Consumers Credit Union offers auto loans at very low rates. The credit union is based in Illinois and offers membership to anyone who can pay and has at least $5 saved in a savings account. BBB has awarded the credit union an A+ rating.
Consumers Credit Union offers auto loans to people with excellent credit. This means they are open to anyone with good to exceptional credit.
TrueCar helps shoppers locate vehicles across the country. Consumers Credit Union is a TrueCar partner like PenFed Credit Union. TrueCar customers can still receive the same interest rates regardless of whether they shop with TrueCar.
Rates start at 2.49% to finance a new vehicle and 2.74% to finance a used vehicle. Consumers Credit Union offers a discount of 0.25% on autopay and an additional 0.25% if that autopay is linked with a Consumers Credit Union bank account.
LightStream
LightStream, the online lending arm of Trust Bank, was founded in 2004. It was created when SunTrust Bank and Branch Banking and Trust Company merged. It has a rating of 4.9 stars out of 5.0 stars based on 18,000 customer reviews.
The BBB has accredited it with an A+ rating. LightStream offers loans of any kind to those with good credit. Auto loans don’t have any restrictions regarding the vehicle it is being financed. This gives borrowers plenty of options. The starting loan amount is $5,000.
Auto loan companies like LightStream offer competitive auto loan rates for borrowers. Auto loans from LightStream start at 2.499% for new and used vehicles. These rates also include an autopay discount. The rate without autopay will be 0.5% lower. LightStream’s Rate Beat program is a nice option.
LightStream will beat any competitor’s interest rate under certain conditions. LightStream will offer a 0.1% discount if you have been approved for a lower rate from a comparable lender for the same terms, and you can prove it. It is important to note that rates by credit score may vary.
What is a good car loan interest rate?
What is the current best car loan rate? The National Credit Union Administration (NCUA) reports that a credit union’s average new 60-month car loan has a 3.09% interest rate.
The average interest rate from a bank is 4.81%. These rates indicate that you are getting a fair rate for your car loan. During the loan application process, it’s important to consider the type of auto loan and the credit approval needed.
What is the Good Used Car Loan Rate?
Used car loan rates are generally higher than new car rates. A good used car loan rate from a bank for 48 months is 5.16% or less. A credit union’s good rate for used cars is 3.16%. Keep in mind that your auto loan payment amount may vary based on the terms of the loan.
What affects the loan interest rates
These rates are the average APRs based on information provided to NCUA. There may be different rates depending on many factors, such as your current loan status, credit history, and the lender’s terms and conditions.
- Credit score: Low credit scores will result in a higher interest rate. The most important factor lenders use to decide rates is the credit score.
- A shorter term means lower interest rates. Consider making higher monthly payments to get a shorter-term loan at a lower overall cost.
- Credit report: Lenders will look at all credit reports. Two people with identical scores can get different rates depending on how they were calculated.
- Income: Lenders may require a minimum income to qualify borrowers and get the best auto loan rates.
- Auto loan refinancing: This option can help lower your interest rate and monthly payment, especially if your credit score has improved since getting the initial loan.
- You can reduce your interest rates by making a higher down payment.
- Interview process: A professional approach and supporting documentation are key to getting you the best auto loan rate.
- Negotiation: You can use multiple prequalifications to negotiate interest rates with lenders.
- Autopay: Many lenders offer autopay discounts. If you have an account with the same credit union, you may also be eligible for a discount on your loan.
Which bank has the best auto loan rates?
Bank of America currently has the lowest rate on car loans (starting at 2.39%). You can get these rates with excellent credit and a new vehicle. Other banks may offer lower rates than the best auto loan rates, but you can get a better rate with an auto loan purchase.
How to get the best auto loan rates
There are many ways to save money while getting the best auto loan rates. If saving money is your goal, consider purchasing a pre-owned or certified used car with an auto loan purchase.
A used or certified pre-owned car two to three years old will cost significantly less than a newer model. You can save money even if your APR rises by 1 to 2% through an auto loan purchase.
There are a few things you can do to lower your interest rate. If you put in the effort, you can improve your credit score in months or even a year.
You can easily move up a credit score by 20-30 points and significantly impact your types of auto loan options. To reduce your APR, you can make a higher down payment.
You can ask a relative with a high credit score to cosign your loan if your less-than-perfect credit score is better than you would like. Their good credit can be used to obtain the best auto rates for auto loan customers.
This route will allow you to ensure that you can afford your monthly payments. If not, your credit score and credit rating could be affected.
The related point is that if you buy an extended warranty from a dealer, the cost can often be added to your monthly car payment. To save money while protecting your vehicle, buy a standalone vehicle maintenance contract later. This will increase the variety of auto loans available, as well as the amount of your loan and the amount of interest you pay.
Compare Auto Loan Providers
It is easy to compare auto loan rates. As long as they do not require a hard credit check, you can receive as many pre-approvals as possible. Before you meet with a loan officer at your car dealership, do this.
When comparing offers, consider prepayment penalties, minimum loan amounts, and application fees. These factors can impact the overall loan cost and influence your decision.
Once you are ready to accept an offer, you must complete a loan application with the institution that offers the best auto refinance rates and meets your financial needs.
Frequently Asked Questions
What are the current trends in auto loan rates for 2024?
Auto loan rates are expected to be higher in 2024 compared to 2022, averaging around 5-7% for new cars and 4-6% for used. However, excellent credit could qualify for rates under 3%.
How can I find the best auto loan rates in 2024 for my credit score?
Prequalify with multiple lenders to compare personalized rates. Online lender rate checkers can also help you find the best rates for your specific credit score and situation.
What factors should I consider when comparing auto loan rates for 2024?
Key factors are the loan term length, lender fees, new versus used car rates, fixed versus variable rates, your selected down payment amount, and any special financing offers.
Are there any tips or strategies for negotiating the best auto loan rates in 2024?
Improving your credit score, opting for a shorter loan term, making a larger down payment, taking advantage of OEM offers, and negotiating with multiple lenders can help secure the best rates.
Which banks or lenders are offering the most competitive auto loan rates in 2024?
Major banks like Capital One, Chase, Bank of America and credit unions often have the best rates, along with online lenders like PenFed Credit Union, Lightstream, and AutoPay. Shop and compare options.
