Average Auto Loan Interest Rate in 2026: New vs Used Car Loans
Car loan rates vary dramatically based on credit score and whether you're buying new or used. Here's exactly what to expect in 2026 — and how to lock in the lowest rate possible.
In 2026, average new car loan APRs are approximately 6.5-7.5% for borrowers with good credit, while used car loans average 9-11% APR. Rates for excellent credit (750+) can be as low as 5.5%, while subprime borrowers may face 15-20%+ APR.
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2026 Average Auto Loan Rates by Credit Score
| Credit Score | New Car APR | Used Car APR |
|---|---|---|
| Excellent (750+) | 5.5–6.5% | 7.5–9% |
| Good (700–749) | 6.5–8% | 9–11% |
| Fair (650–699) | 8–11% | 11–15% |
| Poor (below 650) | 11–18% | 15–22%+ |
Source: Federal Reserve consumer credit data and industry lender averages, 2026.
Why Used Car Loans Cost More
Lenders view used vehicles as higher risk due to faster depreciation, uncertain maintenance history, and lower resale value as collateral. This typically adds 2-4 percentage points to the APR compared to new car financing.
5 Ways to Get a Better Rate
- Check your credit score first — even a 20-point improvement can meaningfully lower your rate
- Get pre-approved by your bank or credit union before visiting dealers
- Shop multiple lenders — rates can vary 2-3 points between lenders for the same borrower
- Choose a shorter term — 36-48 month loans typically carry lower rates than 72-84 month terms
- Put more down — a larger down payment reduces lender risk and can improve your rate
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