Is 6% auto loan good? (2024)

Is 6% auto loan good?

If you have excellent credit (750 or higher), the average auto loan rates are 5.07% for a new car and 5.32% for a used car. If you have good credit (700-749), the average auto loan rates are 6.02% for a new car and 6.27% for a used car.

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Is 6% APR high for a car?

If you can get a rate under 6% for a used car, this is likely to be considered a good APR.

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Is 6% a good rate for a loan?

A good personal loan interest rate depends on your credit score: 740 and above: Below 8% (look for loans for excellent credit) 670 to 739: Around 14% (look for loans for good credit) 580 to 669: Around 18% (look for loans for fair credit)

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Is 7% car loan high?

The average auto loan interest rate in the third quarter of 2023 was 7.03% for new vehicles and 11.35% for used vehicles, according to Experian. However, the rate you receive on a car loan will depend on your credit scores. The higher your scores, the lower your auto loan rate.

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What is considered a good auto loan rate?

Average car loan interest rates by credit score
Credit scoreAverage APR, new carAverage APR, used car
Superprime: 781-850.5.61%.7.43%.
Prime: 661-780.6.88%.9.33%.
Nonprime: 601-660.9.29%.13.53%.
Subprime: 501-600.11.86%.18.39%.
2 more rows
7 days ago

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Is 6% good for used car?

A good interest rate for a car loan is typically below 5.18% for new cars and 6.79% for used vehicles.

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How high is too high for an APR?

Anything below the average credit card interest rate — 23.55% for new offers, as of February 2023, according to a LendingTree study — is generally considered a good APR, and anything above that rate is considered high.

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What is a bad interest rate on a car?

Auto loan interest rates by credit score
Credit scoreAverage APR, new carAverage APR, used car
Prime: 661-780.6.88%.9.33%.
Nonprime: 601-660.9.29%.13.53%.
Subprime: 501-600.11.86%.18.39%.
Deep subprime: 300-500.14.17%.21.18%.
2 more rows
Jan 2, 2024

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What is a good interest rate for a car 2023?

According to Experian's State of the Automotive Finance Market report, the average auto loan interest rate for new cars in 2023's third quarter was 7.03 percent — 11.35 percent for used cars. Generally, the lower your score, the higher your annual percentage rate (APR) will be.

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Why is my APR so high with good credit?

Key takeaways. Your credit card APR can go up if the prime rate changes, you paid your credit card bill late, your intro APR offer ended or your credit score dropped. If your APR increases, you can work on paying down your balance or transfer your balance to a card with a low or 0 percent intro APR offer.

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What is too high for a car loan?

According to experts, a car payment is too high if the car payment is more than 30% of your total income. Remember, the car payment isn't your only car expense! Make sure to consider fuel and maintenance expenses. Make sure your car payment does not exceed 15%-20% of your total income.

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What is too big of a car loan?

Many financial experts recommend spending no more than about 10% to 15% of your monthly take-home pay on an auto loan payment. Updated: October 02, 2023.

Is 6% auto loan good? (2024)
What is a good interest rate for a car for 72 months?

An interest rate under 5% is a great rate for a 72-month auto loan. However, the best loan offers are only available to borrowers who have the best credit scores and payment histories.

What interest rate can I get with a 750 credit score for a car?

Average Car Loan Interest Rate by Credit Score
Average Auto Loan Interest Rate by Credit Score
Average New Car RateAverage Used Car Rate
Nonprime (620-659)8.86%13.28%
Prime (660-719)6.40%8.75%
Super prime (720 or above)5.18%6.79%
2 more rows
Jul 5, 2023

Is 8% a bad interest rate for a car?

For used cars, financing costs are steeper, with average rates climbing from 7.4% to 11%. These rates can be even higher for borrowers with poor credit scores. Such rates have pushed vehicle loans closer to what's commonly considered high-interest debt — generally, any debt with an interest rate higher than 6% to 8%.

Can you negotiate interest rates on cars?

Can you negotiate auto loan rates? Yes. Like you negotiate vehicle prices, you can try to lower your interest rates before signing off. One of the best ways to secure a lower rate is by making a larger down payment or choosing a shorter term.

Will car loan rates go down in 2023?

Over the years, recessions and a global pandemic contributed to the volatility of loan rates. Economic experts don't expect the Fed to lower interest rates until 2024.

Will auto rates go down in 2024?

While this increase is not predicted to disappear anytime soon, rates will likely drop slightly for those with healthy credit, predicts Bankrate Chief Financial Analyst Greg McBride, CFA. However, those with weak credit profiles should expect double-digit interest rates to persist in 2024.

What mileage is too high for a used vehicle?

There's no rule to how many miles on a used car is too much, but by attempting to stick to the 12,000 miles per year rule is a great place to start. Find out how old the car is, multiple the number of years by 12,000, and if the number on the odometer is significantly higher than that, some concern might be warranted.

What's the lowest auto loan rates?

Summary: Best Car Loan Rates Of February 2024
CompanyForbes Advisor RatingMinimum rate
PenFed Credit Union4.7Starting at 5.24%
Consumers Credit Union4.2Starting at 6.84% (with autopay)
Digital Federal Credit Union (DCU)3.7Starting at 6.74% (with autopay)
USAA3.7Starting at 5.89% (with autopay)
3 more rows

How do I get my APR lowered?

How can I lower my credit card APR?
  1. Improve your credit score. An improvement in your credit score is critical if you want to start reducing the APR you're being offered by lenders on credit card applications. ...
  2. Consider a balance transfer. ...
  3. Pay off your balance. ...
  4. Learn your credit issuer's policy.

Why is my car interest rate so high?

Among others, these factors typically include credit history, amount financed, length of the term, age of collateral, vehicle, and the down payment. The better your credit, the lower the interest rate. Buyers with stellar credit may qualify for attractive APRs; new car manufacturer offers can be as low as 0%.

What is the highest interest rate allowed by law for a car?

The highest interest rate for a car loan is about 25%. However, the highest car interest rate limits vary by state. And while state laws called usury laws are meant to keep lenders from charging exorbitant rates, there are loopholes in some of these laws.

What is a good interest rate for a car for 60 months?

Auto Loan Purchase Interest Rates
Payment PeriodPurchase APR* "As Low As"Minimum Loan Amount
Up to 36 Months6.24%No minimum loan amount
Up to 48 Months6.49%No minimum loan amount
Up to 60 Months6.74%$10,000
Up to 66 Months6.99%$10,000
4 more rows

Who has the best auto rates?

Compare Best Auto Loan Lenders
CompanyUsed APR Range
AUTOPAY Best for Bad Credit/Low RatesAs low as 5.69%
Consumers Credit Union Best Credit UnionAs low as 6.84%
LendingTree Best for RefinanceAs low as 5.99% (Refinance)
LendingClub Best for Fair Credit4.99%–24.99% (Refinance)
3 more rows
Feb 9, 2024

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