BEST OF

Compare Auto Loans, Rates and Lenders

What to know about auto loans before you apply.

Sep 14, 2022

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Auto loans are available for buying new and used cars, buying out car leases and refinancing current auto loans. But not every lender offers every kind of auto loan or serves every level of credit.

Below you can learn more about the types of auto financing available and compare lenders to find the best car loan rates. We also provide basic information about applying for an auto loan.

Compare Auto Loans, Rates and Lenders

Our pick for

Used auto purchase

Consumers Credit Union
Learn more

on Consumers Credit Union's website

Consumers Credit Union - Used car purchase loan

Consumers Credit Union

Est. APR

3.99-18.54%

Loan amount

$7,500-No max.

Min. credit score

620
Learn more

on Consumers Credit Union's website


Min. credit score

620

Key facts

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

Pros

  • No vehicle restrictions.

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

  • Offers rate discount with automatic payment.

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

  • Allows co-signers.

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

  • 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.

Read Full Review
LightStream
Learn more

on LightStream's website

LightStream - Used car purchase loan

LightStream

Est. APR

5.49-9.99%

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 or excellent credit looking for a flexible, no-hassle used car loan.

Pros

  • Competitive rates, with used car rates the same as new car rates.

  • No vehicle or mileage restrictions.

  • Finances purchases from private parties.

  • Offers rate discount with automatic payment.

  • Has loan experience satisfaction guarantee.

  • No origination or late fees.

Cons

  • Hard credit inquiry required.

  • High minimum credit score required.

Qualifications

  • Minimum annual gross income: None.

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

  • Bankruptcy restrictions: Yes. Details not disclosed.

  • Maximum mileage: None.

  • Maximum loan to value ratio: None.

Read Full Review
MyAutoloan
Learn more

on MyAutoloan's website

MyAutoloan - Used car purchase loan

MyAutoloan

Est. APR

2.24-24.99%

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.

  • Allows co-signers.

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
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

450
Learn more

on Carvana's website


Min. credit score

450

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 Alaska or Hawaii.

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

Our pick for

New auto purchase

Consumers Credit Union
Learn more

on Consumers Credit Union's website

Consumers Credit Union - New car purchase loan

Consumers Credit Union

Est. APR

3.74-17.54%

Loan amount

$7,500-No max.

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.

  • Allows co-signers.

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
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.

  • Allows co-signers.

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
LightStream
Learn more

on LightStream's website

LightStream - New car purchase loan

LightStream

Est. APR

5.49-9.99%

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 or excellent credit looking for a flexible, no-hassle new car loan.

Pros

  • Competitive rates compared with similar lenders.

  • Offers rate discount with automatic payment.

  • Has a loan experience satisfaction guarantee.

  • No origination or late fees.

  • Available in all 50 states.

  • No vehicle restrictions.

Cons

  • Hard credit inquiry required.

  • High minimum credit score required.

Qualifications

  • Minimum annual gross income: None.

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

  • Bankruptcy restrictions: Yes. Details not disclosed.

  • Maximum mileage: None.

  • Maximum loan to value ratio: None.

Read Full Review

Want to compare more options? Here are our other top picks:

7 types of auto loans

New car purchase loans enable you to borrow money to buy a new car and pay it off over time. Lenders typically define a new car as one that has never been titled and is the current or previous model year.

Used or pre-owned cars are older than the previous model year. Loans for used cars may come with certain restrictions, such as maximum mileage or vehicle age. These loans can help you pay for a used car you buy from a dealer, from an online car retailer or from a private party.

Auto refinancing loans enable you to replace your current auto loan with a new one from another lender. You may want to refinance if you think you could now qualify for a lower interest rate. Refinancing a car loan can be a way to lower your car payment or pay off your loan sooner, saving you money on the total interest you pay.

Cash-out auto refinance loans work like regular refinancing, except you can borrow extra money against the equity in your car and roll that amount into the refinance loan.

Lease buyout loans finance the purchase of your leased vehicle, so you can keep it or sell it to profit from any equity you have in the car.

Auto loans for bad credit are offered by lenders that are more flexible about working with borrowers who have low credit scores, no credit history or past bankruptcies. Not all lenders serve this customer, and those who do charge higher interest rates.

First-time car buyer loans can be challenging to get when you have no previous car loan or credit history. But some lenders have more flexible credit requirements to help first-time car buyers qualify, although it's often with a higher interest rate.

What to know before you apply for an auto loan

Regardless of the type of auto loan you apply for, here is some basic information that can help you through the process.

Interest rate or APR: Your loan's interest rate, also called annual percentage rate or APR, is the amount you agree to pay each year to borrow money, on top of the cost of the car. It includes any lender fees and is expressed as a percentage. APRs vary, but you can use the table below to estimate the interest rate you might expect for your credit score on a new or used auto loan.

Your credit score is only one factor that goes into determining your APR. Lenders also consider other criteria, such as income, the loan term and the type of vehicle you’re buying.

Credit score

Average APR, new car

Average APR, used car

Superprime: 781-850.

2.96%.

3.68%.

Prime: 661-780.

4.03%.

5.53%.

Nonprime: 601-660.

6.57%.

10.33%.

Subprime: 501-600.

9.75%.

16.85%.

Deep subprime: 300-500.

12.84%.

20.43%.

Source: Experian Information Solutions.

Credit scores fall within a range of 300 to 850 on two basic scoring models, FICO and VantageScore. Some auto lenders use industry-specific scoring on top of the basic FICO model when making auto loan decisions, so the rate and whether you’re approved can depend on which scoring model an auto lender uses. You can get your credit report with credit score for free through NerdWallet or from annualcreditreport.com.

Pre-qualification vs. preapproval: Some lenders use the terms “pre-qualify” and “preapprove” interchangeably, but in most cases they are different. When a lender pre-qualifies you for an auto loan, you will usually provide a limited amount of information to see an estimate of how much you may qualify to borrow and at what interest rate. Many lenders do only a soft credit inquiry for pre-qualification, which won’t affect your credit scores.

Auto loan preapproval usually requires you to provide more personal information, such as a Social Security number. It’s a conditional approval of credit, pending verification of your information, and typically carries more weight than pre-qualification. If you’re buying from a dealership, presenting a preapproved loan offer from another lender gives the dealership a rate to beat.

Neither pre-qualification nor preapproval guarantees loan approval, and the loan rate and terms can change later in the loan process. A hard credit inquiry, which temporarily lowers your credit scores, will be done before a loan is finalized.

Auto loan term: The term is the amount of time you have to repay a loan. The most common loan terms are 24, 36, 48, 60, 72 and 84 months. NerdWallet recommends avoiding long car loan terms if possible, limiting new cars to 60 months and used cars to 36.

Going with a longer term loan may result in a lower monthly payment, but you will pay more in interest over the life of the loan. Also, because cars depreciate quickly, you could end up owing more than a car is worth, which is called being “underwater” or "upside down” on a car loan.

Compare auto loans from multiple lenders

Lenders vary when it comes to the criteria they use for approving auto loans and setting rates, so you may benefit from applying to several.

When deciding where to apply, consider any restrictions a lender may have. Some exclude certain makes and models of cars, or they limit the age or mileage of a vehicle. You can read auto lender reviews on NerdWallet to see restrictions for the lenders we’ve reviewed.

Last updated on September 14, 2022

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