The Rate Landscape
Rates aren't what they were a few years ago. 0% financing is rare. But deals exist if you know where to look.
Average Rates by Tier
- Super Prime (781-850): 4.5-5.5% new, 5.5-6.5% used
- Prime (661-780): 5.5-7.0% new, 7.0-9.0% used
- Near Prime (601-660): 8.0-11.0% new, 10.0-14.0% used
- Subprime (501-600): 12.0-16.0% new, 15.0-20.0% used
Used car rates are typically 1-3% higher than new for the same borrower.
Best Sources
- Credit unions: consistently 1-2% below banks
- Manufacturer captive lenders: promotional rates as low as 0.9-2.9% for top-tier
- Online lenders offer competitive rates with quick approvals.
- Traditional banks: highest rates unless you have a relationship
The Term Trade-Off
A 72-month loan at 5% costs MORE total interest than a 48-month loan at 6%. Calculate total interest, not just rate.