{"id":821130,"date":"2019-12-05T15:05:02","date_gmt":"2019-12-05T20:05:02","guid":{"rendered":"https:\/\/www.finder.com\/ca\/?p=821130"},"modified":"2026-01-06T15:53:08","modified_gmt":"2026-01-06T20:53:08","slug":"credit-union-auto-loans","status":"publish","type":"post","link":"https:\/\/www.finder.com\/ca\/car-loans\/credit-union-auto-loans","title":{"rendered":"Credit union car loans"},"content":{"rendered":"

Credit unions are not-for-profit financial institutions that are owned by their members. While you may need a membership, you can often find competitive rates on credit union car loans.<\/p>

Credit union car loan rates<\/h3>

As a benchmark, the average car loan rate in Canada according to Statistics Canada is 6.72%.<\/p>
<\/th>Credit union car loan rate<\/th>Loan term<\/th><\/tr><\/thead>
\"NLCU<\/td>4.3% - 6.7%<\/span><\/td>36 - 96 months<\/td><\/tr>
\"Kawartha<\/td>From 6.49%<\/span> for vehicles 5 years old or less<\/td>Up to 60 months<\/td><\/tr>
\"DUCA<\/td>From 6.90%<\/span><\/td>12 - 60 months<\/td><\/tr>
\"SCU,<\/td>Personal loans start at 5.45%<\/span><\/td>Undisclosed<\/td><\/tr><\/tbody><\/table>
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\nMust read: <\/span>Best car loans in Canada<\/a>\n<\/div>\n<\/article>

Should I get a car loan from a credit union?<\/h3>

It depends on what you\u2019re looking for in a car loan. Credit unions provide competitive car loan interest rates in Canada depending on the car you\u2019re looking to buy and your financial situation. For example, some credit unions have special rates for any type of new car, including electric and hybrid vehicles. However, you may need to get a membership to apply for credit union car loans.<\/p>

Fixed vs. variable rate credit union car loans<\/h3>

You might be able to choose between a fixed or variable interest with your credit union auto loan. With a fixed rate car loan, your interest rate stays the same throughout the loan term. With a variable rate car loan, your interest rate goes up or down depending on the credit union\u2019s prime rate. This is influenced by the Bank of Canada\u2019s prime interest rate, which changes regularly.<\/p>

If the variable rate goes up, your payments usually stay the same, but more of your money goes towards paying down interest rather than the principal amount.<\/p>

The central bank raised the benchmark interest rate eight times from March 2022 to January 2023. Rates are expected to lower in 2024, although Bank of Canada representatives have not confirmed the timing, saying they are waiting for inflation indicators to ease sustainably before making a move.<\/p>

Secured vs. unsecured credit union auto loans<\/h3>

When searching for credit union car loans, one feature to note is whether the car loan is secured or unsecured, because this can differ among credit unions. Generally, loans with collateral have lower interest rates than loans without collateral.<\/p>

A secured car loan<\/a> means the car you\u2019re buying is collateral for the loan. If you fail to make repayments, the credit union can repossess your car. An unsecured car loan does not require collateral. The older the car, the less likely it will be accepted as collateral.<\/p>

New vs. used credit union car loans<\/h3>

Credit unions offer car financing for both new and used vehicles. Some offer special discounted rates for current-year models or new electric vehicles.<\/p>

Credit unions can also finance used cars, but there may be a cut-off year. Banks and credit unions typically don\u2019t want to finance cars older than 10 years. If you\u2019re buying a used car, expect higher rates compared to a new car loan.<\/p>

Do I qualify for credit union auto loans?<\/h3>

To qualify for credit union car loans, you must meet two sets of criteria: membership requirements and loan eligibility requirements.<\/p>

Membership requirements<\/h4>

Credit unions are meant to serve a specific population. There are three main types of membership requirements for credit unions:<\/p>