New car loans had an average interest rate of 6.35%, while used car loan rates averaged 11.19% in the second quarter of 2026. Your credit score plays a significant role in determining your interest rate, but other factors also play a role. The best way to secure a competitive interest rate on your auto loan is to shop rates with multiple lenders and improve your credit score before you apply.
The average auto loan interest rate for new cars in the second quarter of 2026 was 6.35%, while the average used car loan interest rate was 11.19%, according to Experian's State of the Automotive Finance Market report. These average rates matter because they let you know if the auto loan you receive is actually competitive — and whether you need to spend more time shopping around for the best auto loan rates. Learn the market so your next car loan is affordable for your budget and so you avoid paying more interest to your lender.
Expect new car rates between 4.5% and 16%. Used car rates trend higher, ranging from just over 6% to 22%. Source: Experian State of the Automotive Finance Market, Q2 2026 Your APR won't be solely based on your credit, but it is a good way to check that you aren't overpaying for a car loan.
If your auto loan offer doesn't align with market averages for your credit score range, it's a good sign that you need to keep shopping. Most lenders offer a preappoval process to check your rates, and your credit won't suffer if you apply with multiple auto loan lenders within a 14-day period. Should you wait to apply until you have good credit?
Auto loan rates increase if you fall outside of the prime range. It's possible to get a good rate without a perfect score, but by improving your score for a car loan, you will likely qualify for a more competitive rate and pay less overall. Interest is the price you pay each month to borrow money.
The higher your interest rate, the more you pay overall for your loan. Even reducing your interest rate by a fraction of a percentage point can save you hundreds of dollars. For example, we calculated the cost of a new car loan with a $30,000 balance and a term of 60 months.
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