Editor's choice: Carvana
- Most credit types welcome
- 45-day preapproval
- Seven-day guarantee
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Need more information? Check out the details in the car loans APR table below.
|Loan Provider||APR range||Loan term lengths|
|Carvana||3.9% to 27.9%||12 to 72 months|
|Auto Credit Express||Varies by lender||Typically 3 years to 6 years|
|car.Loan.com||0% to 25% depending on state, vehicle type and credit history.||Varies by lender|
|LendingTree||From 3.09%||Typically 1 year to 7 years|
|CarsDirect||Varies by lender||Varies by lender|
|SpringboardAuto||From 7%||Up to 72 months|
|Bluesky Auto Finance||From 3.99%||24 to 72 months|
|RoadLoans||No estimates until you apply||Up to 72 months|
|CarFinance.com||From 4.99%||Up to 72 months|
Low-Interest rates are usually reserved for those with good credit and regular income. Here are five ways you can get the lowest rates possible for your next car loan.
Generally, the lowest interest rates you can find on a car loan are around 2% or 3%. However, any car loan with a rate under 5% is considered low-interest — and you’ll need good or excellent credit to qualify.
However, if you have less-than-stellar credit, the lowest rate you might be eligible could be upwards of 10%. Since car loans are usually secured, they typically come with lower rates than an unsecured personal loan.
Just because you see a low-interest rate advertised for a car loan with one particular lender, don’t automatically think that’s how much you’ll end up paying. Those ultra-cheap interest rates may only be available to you if you have excellent credit or if you are buying a certain type of car.
Low interest car loans come with a few costs, but each individual loan will differ depending on the lender you apply with.
Here’s are some fees to watch out for:
How much your car loan costs also depends on how long you take to pay it back — that means there’s more time for interest to add up
Let’s assume you want to borrow $20,000. Over a five-year term you might be quoted an 8% interest rate, but you’re offered a 7.5% rate if you accept a seven-year loan term. Let’s see how it would work out.
|Low interest loan details||8% interest rate||7.5% interest rate|
Total interest paid
If you choose the 7.5% interest rate your payments are almost $100 per month cheaper. This can be appealing because it’s obviously more budget-friendly. Unfortunately, even with the cheaper interest rate you end up paying more than $1,436 in additional interest charges.
One option is making additional payments and paying off your car loan sooner, but check to see if you’ll be charged an early repayment fee that wipes out any savings you thought you were getting.
Use our monthly repayment calculator to find out how much you’d end up paying per month and overall with a low-interest car loan.
Buying a brand new car might get you a lower interest rate, but a new car might not be what you need — or can afford. Here are some factors that can influence the interest rate you pay, even for a car to get you from point A to point B.
The best loan for you will be the one offered with the lowest interest rate and minimal extra costs. Check what fees are being charged for your loan and ask them to be reduced. If you can’t get them reduced, shop around elsewhere for a more competitive deal and always compare your car loan options before you apply.
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