Compare Auto Loan Rates & Financing
MoneyLion makes auto financing simple by connecting you with competitive loan rates from trusted lenders, so you can get the best auto loan for you — and start enjoying your new ride.
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How do auto loans work?
An auto loan is a type of financing that allows you to borrow money to purchase a car. The loan is paid back in installments, with interest, over a specified term. The lender retains ownership of the car until the loan is fully repaid.
Interest rates on auto loans depend on several factors, including your credit score, the loan term, and the type of vehicle (new or used). Auto loan rates typically vary between lenders, so it's important to compare options to find the best deal.
Interest rates on auto loans depend on several factors, including your credit score, the loan term, and the type of vehicle (new or used). Auto loan rates typically vary between lenders, so it's important to compare options to find the best deal.
How to get an auto loan
While everyone's exact situation is different, these three main steps are mandatory for everyone trying to get an auto loan.
- Check your credit report: Your credit score plays a major role in determining your auto loan rates. You can access a free credit report every 12 months via Annual Credit Report. Generally, borrowers with higher credit scores receive the best rates. Most lenders require a score of at least 600 for favorable rates, though those with lower scores can still qualify with additional steps like a larger down payment.
- Compare auto loan rates and lenders: Using a service like MoneyLion makes it easy to compare multiple offers from different lenders, giving you a clearer picture of what rates and terms are available. Compare options for new car loans or used car loan rates to ensure you're getting the best deal.
- Submit your auto loan application: Once you've found a lender with a competitive offer, submit your auto loan application through MoneyLion's platform. The process is simple, and MoneyLion connects you with lenders that provide fast approvals and flexible terms.
How to compare auto loan rates and lenders
When comparing auto loan rates and lenders, it's important to consider several factors that impact your financing:
APR: The Annual Percentage Rate (APR) includes both the interest rate and any fees charged by the lender. Lower APRs result in lower overall costs.
Loan term: A longer loan term may reduce your monthly payments but could lead to higher interest paid over time.
Loan amount: The total amount you borrow affects your payments, so it's essential to choose a loan size that fits your budget.
Additional fees: Some lenders may charge application or prepayment fees, so it's essential to read the fine print.
Lender's reputation and features: Choose a lender with good online reviews, and consider the benefits of convenient loan payment options, like an app or online portal.
Factors that influence your monthly car payment
Several elements affect the size of your monthly payment:
Purchase price: The higher the car's price, the larger the loan and the higher the payment. Opt for more affordable vehicles if you're aiming to save.
Car loan down payment: A larger down payment can reduce your loan amount and lower your monthly payment.
APR: The interest rate you receive from the lender, based on factors like your credit score, impacts how much you'll pay in interest over time.
Current trade-in value: Trading in your old vehicle can reduce your loan amount, lowering your payments.
Loan term: A shorter loan term typically means higher monthly payments but less interest paid overall.
Average auto loan rates by credit score
Your credit score (along with other factors) significantly influences your auto loan rates. Here's a breakdown of current average auto loan rates by credit score:
Credit score | Average new car loan rate | Average used car loan rate |
|---|---|---|
781-850 | 5.25% | 7.13% |
661-780 | 6.87% | 9.36% |
601-660 | 9.83% | 13.92% |
501-550 | 13.18% | 18.86% |
300-500 | 15.77% | 21.55% |
Can I get auto financing with bad credit?
Yes, you can still qualify for auto financing with a low credit score. However, you may need to take additional steps to secure a loan. One option is to use a co-signer with a stronger credit profile to help you qualify for better auto loan rates. Alternatively, making a larger down payment can reduce the loan amount and improve your approval chances.
Types of auto loans
Several types of auto loans are available, depending on your needs:
New auto loan: Used to finance a brand-new vehicle. These loans often come with lower interest rates compared to used car loans.
Used auto loan: Financing for pre-owned vehicles. Used car loan rates are generally higher due to the risk associated with older vehicles.
Auto refinance loan: Allows you to replace your current auto loan with a new one, ideally at a lower interest rate.
Cash-out auto refinance: Similar to a refinance loan, but you can also borrow additional funds based on your car's equity.
Lease buyout: If you're leasing a car, a lease buyout loan helps you purchase it when the lease term's done.
MoneyLion can make finding your car loan easier
At MoneyLion, we make car loans simple by connecting you with top lenders and offering competitive auto loan rates. Our platform simplifies the process, helping you compare offers so you can find the best deal for you, whether it's a new or used car.
Learn more about Auto Loan
You've got questions. We have answers.
Typically, auto loans require monthly payments. Each month, you'll pay a fixed amount that goes toward both the principal (the amount you borrowed) and the interest (the cost of borrowing).
Here are some important things to know about auto loan payments:
• Payment frequency: Monthly payments are the standard for most auto loans.
• Breakdown of payments: Each payment is divided into two parts — principal and interest. When you pay, you're reducing the loan balance (principal) and covering the interest.
• Consistency matters: Making timely payments each month is essential to avoid late fees and stay on track with your loan repayment.
Here are some important things to know about auto loan payments:
• Payment frequency: Monthly payments are the standard for most auto loans.
• Breakdown of payments: Each payment is divided into two parts — principal and interest. When you pay, you're reducing the loan balance (principal) and covering the interest.
• Consistency matters: Making timely payments each month is essential to avoid late fees and stay on track with your loan repayment.
Auto loan rates fluctuate based on various economic factors, including the Federal Reserve's interest rate policies, inflation trends, and the overall state of the economy. Predicting exactly when auto loan rates will go down can be challenging, but here are some factors to consider:
1. Federal Reserve actions: If the Federal Reserve lowers the federal funds rate, auto loan rates are likely to follow. This could happen if inflation cools or the economy slows down, leading the Fed to ease monetary policy.
2. Economic conditions: A slowdown in economic growth or lower inflation could prompt lenders to reduce interest rates to encourage borrowing.
3. Market competition: Sometimes, lenders lower rates to attract more customers in competitive markets, particularly if demand for loans declines. This is why it's important to compare loan offers!
1. Federal Reserve actions: If the Federal Reserve lowers the federal funds rate, auto loan rates are likely to follow. This could happen if inflation cools or the economy slows down, leading the Fed to ease monetary policy.
2. Economic conditions: A slowdown in economic growth or lower inflation could prompt lenders to reduce interest rates to encourage borrowing.
3. Market competition: Sometimes, lenders lower rates to attract more customers in competitive markets, particularly if demand for loans declines. This is why it's important to compare loan offers!
Rather than focusing on just one bank, it's smarter to compare auto loan offers from multiple trusted lenders. This helps you find the best rate and terms for your financial situation. That's where MoneyLion comes in — we gather offers from a variety of reputable lenders, so you can easily compare rates in one place and choose the option that works best for you.
What are the different types of auto loans?