BEST OF

11 Auto Loans for Good and Bad Credit

Get an auto loan direct from the lender or compare loans from multiple lenders to find your best rate.

Jun 24, 2020

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Shopping for the lowest interest rate on your auto loan before you buy your next car puts you in a stronger negotiating position and saves you money over the life of your loan. If you already have a loan, you may be able to lower your monthly payment and save money by refinancing your car loan.

You can compare multiple offers below for auto purchase loans, auto loan refinancing, even online car dealers with financing. Bookmark our auto loans calculator to estimate your monthly payment.

Auto Loans for Good and Bad Credit

MyAutoloan
Learn more

on MyAutoloan's website

MyAutoloan - Used car purchase loan

MyAutoloan

Est. APR

2.74-24.99%

Loan Amount

$8,000-$100,000

Min. Credit Score

575
Learn more

on MyAutoloan's website


Min. Credit Score

575

Key facts

Best for applicants wanting to quickly receive loan offers from multiple lenders for the purchase of a used vehicle from a dealer or private party. Bad- and fair-credit borrowers may qualify.

Pros

  • Applicants can receive up to four lender matches with a soft credit check.

  • Most lenders can provide approval within 30 seconds of application submission.

  • Provides lowest daily rates on website, including used auto and private party purchases.

  • Some marketplace lenders offer rate discount with automatic payment.

Cons

  • May result in multiple contacts from different lenders.

  • Social Security number required to submit initial application.

  • myAutoloan.com offers limited customer service support.

  • Not available in a few states.

Qualifications

  • Minimum annual gross income: $26,100.

  • Maximum debt-to-income ratio: Not provided

  • Bankruptcy-related restrictions: Must be discharged or dismissed.

  • Maximum mileage: 125,000.

  • Maximum loan to value ratio: Not provided.

Read Full Review
Consumers Credit Union
Learn more

on Consumers Credit Union's website

Consumers Credit Union - New car purchase loan

Consumers Credit Union

Est. APR

2.58-20.74%

Loan Amount

$7,500

Min. Credit Score

620
Learn more

on Consumers Credit Union's website


Min. Credit Score

620

Key facts

Best for applicants wanting to take advantage of rate discounts and other credit union benefits.

Pros

  • Offers rate estimates through website using a soft credit check.

  • Takes applications online, by phone, in branches or at authorized dealerships in Illinois and Southern Wisconsin.

  • Offers rate discount with automatic payment.

  • Provides online car buying service with discounted pricing and loan preapproval.

Cons

  • Credit union membership required to get a loan.

  • No rate discounts if using online car buying service.

  • Social Security number required for online rate estimate.

Qualifications

  • Minimum annual gross income: None.

  • Maximum debt-to-income ratio: Did not disclose.

  • Bankruptcy restrictions: No open bankruptcies.

  • Maximum mileage: None.

  • Maximum loan to value ratio: 125%.

Read Full Review
LightStream
Learn more

on LightStream's website

LightStream - New car purchase loan

LightStream

Est. APR

2.99-9.99%

Loan Amount

$5,000-$100,000

Min. Credit Score

660
Learn more

on LightStream's website


Min. Credit Score

660

Key facts

Best for borrowers with good credit looking for a no-hassle loan from a well-known bank.

Pros

  • Low starting rates.

  • Available in all 50 states.

  • No vehicle or mileage restrictions.

Cons

  • Hard credit check required.

  • High minimum credit score required.

Qualifications

  • Minimum monthly income: None.

  • Maximum loan to value ratio: None.

  • Maximum mileage: None.

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Capital One
Learn more

on Capital One's website

Capital One - New car purchase loan

Capital One

Est. APR

N/A

Loan Amount

$4,000

Min. Credit Score

Did not disclose
Learn more

on Capital One's website


Min. Credit Score

Did not disclose

Key facts

Best for applicants wanting to pre-qualify for financing and find a new vehicle online, before visiting the dealership.

Pros

  • Pre-qualify with a soft credit check.

  • Auto Navigator offers car shopping and loan pre-qualification by website or app.

  • Charges no origination fee.

  • Borrowers can choose loan payment due date.

Cons

  • Not available in a few states.

  • Must purchase vehicle at a participating dealership.

  • Does not offer rate discounts for automatic payment.

  • Social Security number required to submit initial application.

Qualifications

  • Minimum annual gross income: $18,000.

  • Maximum debt-to-income ratio: Did not disclose.

  • Bankruptcy restrictions: Has restrictions but details not disclosed.

Read Full Review

Digital Federal Credit Union - Used car purchase loan

DigitalFederalCreditUnion

Est. APR

1.49-10.74%

Loan Amount

$2,500-$500,000

Min. Credit Score

Did not disclose

Min. Credit Score

Did not disclose

Key facts

Best for applicants looking for more flexibility and fewer restrictions when financing a used car.

Pros

  • Maximum vehicle mileage higher than other lenders.

  • No maximum vehicle age.

  • Has a 24-hour access consumer loan call center.

  • Finances vehicles purchased from private parties.

  • Offers two opportunities for discounts on already low rates.

Cons

  • Submitting an online purchase loan application results in a hard credit inquiry.

  • Credit union membership required to get a loan.

  • Social Security number required with initial application.

Qualifications

  • Minimum annual gross income: None.

  • Maximum debt-to-income ratio: 60%.

  • Bankruptcy restrictions: No bankruptcies in the previous 12 months.

  • Maximum mileage: 250,000.

  • Maximum loan to value ratio: 135%.

Read Full Review

Bank of America - Used car purchase loan

BankofAmerica

Est. APR

N/A

Loan Amount

$7,500

Min. Credit Score

Did not disclose

Min. Credit Score

Did not disclose

Key facts

Best for applicants who qualify for a Bank of America Preferred Rewards rate discount or want the convenience of purchasing and financing a used car at a Bank of America-authorized dealer.

Pros

  • Apply online, by phone, in a financial center or at an authorized dealership.

  • Offers rate discount for customers with qualifying account relationship.

  • Usually provides loan decision within 60 seconds of application submission.

  • Finances vehicles purchased from private parties.

  • Provides Spanish version of website.

Cons

  • Minimum loan amount is higher than other lenders.

  • Social Security number is required to submit initial application.

  • Rate discount available only with deposit balances of $20,000-plus.

  • Won't finance vehicles purchased at independent dealers not affiliated with auto manufacturers.

Qualifications

  • Minimum annual gross income: Did not disclose.

  • Maximum debt-to-income ratio: Did not disclose.

  • Bankruptcy restrictions: Did not disclose.

  • Maximum mileage: 125,000.

  • Maximum loan to value ratio: Did not disclose.

Read Full Review
Carvana
Learn more

on Carvana's website

Carvana - Used car purchase loan

Carvana

Est. APR

3.90-27.90%

Loan Amount

$1,000-$100,000

Min. Credit Score

Did not disclose
Learn more

on Carvana's website


Min. Credit Score

Did not disclose

Key facts

Best for applicants wanting to streamline car buying and financing, and who will qualify for Carvana’s lower tier rates.

Pros

  • Offers pre-qualification with a soft credit check.

  • Customer service available seven days a week.

  • Borrowers can change their payment due date via the Carvana app.

  • Application process 100% online including document upload.

  • Minimum loan amount is lower than other lenders.

Cons

  • Maximum APR possible is higher than many other lenders.

  • Only finances vehicles sold through Carvana.

  • Not available in all states.

Qualifications

  • Minimum annual gross income: $4,000.

  • Maximum debt-to-income ratio: Did not disclose.

  • Bankruptcy-related restrictions: No active bankruptcies.

  • Maximum mileage: Did not disclose.

  • Maximum loan to value ratio: Did not disclose.

Read Full Review

Vroom - Used car purchase loan

Vroom

Est. APR

N/A

Loan Amount

$5,000-$100,000

Min. Credit Score

Did not disclose

Min. Credit Score

Did not disclose

Key facts

Best for applicants who want to purchase a Vroom vehicle and will qualify for the lowest rates offered by Vroom lending partners.

Pros

  • Offers pre-qualification with a soft credit check.

  • Works with financing partners to find the best offer.

  • Application process 100% online including document upload.

Cons

  • Does not disclose range of estimated APRs.

  • Only finances vehicles sold through Vroom.

Qualifications

  • Minimum annual gross income: None.

  • Maximum debt-to-income ratio: Did not disclose.

  • Bankruptcy-related restrictions: None.

  • Maximum mileage: Did not disclose.

  • Maximum loan to value ratio: Did not disclose.

Read Full Review
MyAutoloan
Learn more

on MyAutoloan's website

MyAutoloan - New car purchase loan

MyAutoloan

Est. APR

1.99-12.99%

Loan Amount

$8,000-$100,000

Min. Credit Score

575
Learn more

on MyAutoloan's website


Min. Credit Score

575

Key facts

Best for applicants wanting to quickly receive loan offers from multiple lenders for the purchase of a new or used vehicle from a dealer or private party. Bad- and fair-credit borrowers may qualify.

Pros

  • Applicants can receive up to four lender matches with a soft credit check.

  • Most lenders can provide approval within 30 seconds of application submission.

  • Provides lowest daily rates on website, including new auto purchases.

  • Some marketplace lenders offer rate discount with automatic payment.

Cons

  • May result in multiple contacts from different lenders.

  • Social Security number required to submit initial application.

  • myAutoloan.com offers limited customer service support.

  • Not available in a few states.

Qualifications

  • Minimum annual gross income: $26,100.

  • Maximum debt-to-income ratio: Not provided

  • Bankruptcy-related restrictions: Must be discharged or dismissed.

Read Full Review

Digital Federal Credit Union - New car purchase loan

DigitalFederalCreditUnion

Est. APR

1.49-10.74%

Loan Amount

$2,500-$500,000

Min. Credit Score

Did not disclose

Min. Credit Score

Did not disclose

Key facts

Best for applicants wanting fast approval, rate discounts and other credit union benefits.

Pros

  • Application process can be 100% online.

  • Has a 24-hour access consumer loan call center.

  • Offers two opportunities for discounts on already low rates.

  • Provides same-day or instant loan approval.

Cons

  • Submitting an online purchase loan application results in a hard credit inquiry.

  • Credit union membership required to get a loan.

  • Social Security number required with initial application.

Qualifications

  • Minimum annual gross income: None.

  • Maximum debt-to-income ratio: 60%.

  • Bankruptcy restrictions: No bankruptcies in the previous 12 months.

  • Maximum mileage: 250,000.

  • Maximum loan to value ratio: 135%.

Read Full Review

Bank of America - New car purchase loan

BankofAmerica

Est. APR

N/A

Loan Amount

$7,500

Min. Credit Score

Did not disclose

Min. Credit Score

Did not disclose

Key facts

Best for applicants who qualify for a Bank of America Preferred Rewards rate discount or want the convenience of purchasing and financing a new car at a Bank of America-authorized dealer.

Pros

  • Apply online, by phone, in a financial center or at an authorized dealership.

  • Offers rate discount for customers with qualifying account relationship.

  • Usually provides loan decision within 60 seconds of application submission.

  • Customer service available on Saturday.

  • Provides Spanish version of website.

Cons

  • Social Security number required to submit initial application.

  • Rate discount available only with deposit balances of $20,000-plus.

Qualifications

  • Minimum annual gross income: Did not disclose.

  • Maximum debt-to-income ratio: Did not disclose.

  • Bankruptcy restrictions: Did not disclose.

  • Maximum mileage: 125,000.

  • Maximum loan to value ratio: Did not disclose.

Read Full Review

What to know before you apply for an auto loan

Car loans with bad credit: Auto lenders look at your credit scores and history but many other factors as well, such as how long you've been employed at your current job, whether you have had previous auto loans and if you have enough income to support the monthly payments.

Interest rates: The interest rate you’ll get depends on your credit score and income, the length of the loan you choose and the vehicle. If you have a loan and make consistent, on-time payments and your credit score improves, you may be able to refinance your car loan to get a better rate and lower your monthly payment.

Average auto loan rates by credit score

Credit score

Average APR, new car

Average APR, used car

Superprime: 781-850

2.58%.

3.68%.

Prime: 661-780

3.64%.

5.35%.

Nonprime: 601-660

6.32%.

9.77%.

Subprime: 501-600

9.92%.

15.91%.

Deep subprime: 300-500

12.99%.

19.85%.

Source: Experian Information Solutions

Loan terms: Some lenders offer loans for up to 84 months. However, it’s best to pay off a car loan quickly since cars depreciate rapidly. Owing more on the loan than the car is worth is called being “underwater” or “upside down,” which is a risky financial situation. Also, the best interest rates are available for shorter loan terms. NerdWallet recommends 60 months for new cars and 36 months for used cars.

“Soft” vs. “hard” credit pull: Some lenders do a “soft pull” of your credit to pre-qualify you for a loan. This doesn’t damage your credit score, but it also doesn’t guarantee you’ll be approved for a loan or get the exact rate you’re quoted. Other providers run a full credit check, which temporarily lowers your credit score by a few points. But again, your final rate could differ slightly from your preapproval quote. A hard pull will be required in all cases before a loan is finalized.

Rate shopping: Applying to several lenders helps you find the most competitive interest rate. However, it can lead to your being contacted by multiple lenders, or even dealers when you apply for a purchase loan, especially if you use a service that compares offers for you (such as myAutoloan).

  • Make all applications within a short rate-shopping window. Credit reporting agencies count multiple hard inquiries made within a certain period — usually 14, 30 or 45 days — as only one inquiry. However it’s also smart to check your credit score afterward to be sure this is the case.

  • If you’re worried about getting overwhelmed by calls and emails, create a new email account and get a free Google Voice phone number that you can check separately.

  • Also check the loan terms that your bank or credit union offers. Their rates can be competitive with those of online lenders.

Restrictions: Some lenders only work with a network of dealerships. Others won’t lend money to buy cars from private sellers. Lenders may also exclude some makes of cars, certain models and types of vehicles, such as electric cars.

Funding: Once the loan is finalized, the lender will offer you a loan with a maximum amount at a stated interest rate. For purchase loans, lenders provide the money in a variety of ways: a no-obligation check, direct deposit to your bank account or a certificate to be used at a car dealership. For auto refinance loans, the lender typically pays off your old lender and you begin making payments to the new lender.

Build refinancing into your plans. Auto loan refinancing is an option for most buyers. You can refinance right away if, for example, you have great credit but took manufacturer financing to qualify for a rebate or special pricing. For first-time buyers or those recovering from past credit troubles, a few on-time payments on your reports will help find your chances of finding a lower rate.

Auto loan rate data courtesy Experian updated 12/10/2021.

Last updated on June 24, 2020

To recap our selections...

NerdWallet's Auto Loans for Good and Bad Credit

Frequently asked questions