What is a Good Interest Rate for a Car Loan?

woman signing a document at a car dealership

Are you looking for the perfect sports luxury model from our new Porsche inventory? Farmington Hills know that finding the answer to “what is a good interest rate for a car loan?” can be tough. Thankfully, our finance team at Fred Lavery Porsche Company will help you learn the answer to one of the most commonly asked questions at our Rochester Hills-area Porsche dealership: “what is a good interest rate for a car loan?”

What is the Average Interest Rate on a Car Loan?

When you’re wondering “what is the average interest rate on a car loan?” there’s no one-size-fits-all answer for every driver. After all, your car loan interest rate depends on your credit score. Rochester Hills drivers with great credit may enjoy a rate that’s near 4%, while drivers near Bloomfield Hills with less than ideal credit could end up with an annual percentage rate over 10%.

But what is the average interest rate on a car loan? Typically, your annual percentage rate will be between 3-4.5% for a three-year loan. Browse average rates by credit score below:

APR by Credit Score (New Car)

  • 781-850: 3.17%
  • 661-780: 4.03%
  • 601-660: 6.79%
  • 501-600: 10.98%
  • 300-500: 13.76%

APR by Credit Score (Used Car)

  • 781-850: 3.8%
  • 661-780: 5.48%
  • 601-660: 10.1%
  • 501-600: 16.27%
  • 300-500: 19.32%

What is a Good Car Loan Rate?

Of course, the lower your rate is, the better. But you should always keep in mind that a 3% is exceptional, and an interest rate that low may not be attainable for all drivers. However, there are plenty of ways to improve your odds of getting a low interest rate at our dealership, from making a larger down payment to negotiating a trade-in.

How Do I Get the Best Interest Rate Possible?

If you’re looking to get the best interest rate possible – and there’s no doubt that you are – you’ll want to monitor your credit very closely. Be sure to checkyour credit score so you can get an idea of what rates you can expect and if you can, start to whittle down existing debts. Paying off any outstanding loans, making future payments on time, and so forth, will help improve your credit score and lower your car loan interest rate.

Finally, remember that the interest rate is just one part of your loan, so don’t overlook your terms when you calculate your monthly payments.

Find Your Next Car at Fred Lavery Porsche Company

Are you ready to see how our finance team can help you get behind the wheel of the Porsche you’ve been dreaming about? Contact us today, apply for financing online and we’ll be glad to help you find a low car loan interest rate for your Franklin drives.

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Fred Lavery Porsche Company 42.542627, -83.2083085.