Calculate your exact monthly car payment, total interest, and true cost including taxes and fees. Compare 36, 48, 60, and 72-month terms side by side. 2026 US rates.
Auto Loan Rates by Credit Score in 2026
Your interest rate is the biggest variable in the total cost of your car loan. With excellent credit (750+) on a new car, rates of 5%–6.5% are available through credit unions. Average rates for all buyers hover around 8%–9% for new and 11%–13% for used. Every 1% reduction in rate on a $30,000 loan saves about $900 over 60 months.
The True Cost Calculation
Most buyers calculate the wrong total. The real cost of a car is vehicle price plus sales tax (varies by state, typically 6%–10%) plus dealer fees plus all interest paid over the loan term. On a $35,000 vehicle in California with 9.5% sales tax, you start with a $38,325 purchase price before financing. Add dealer fees ($800–$1,500) and 60 months of interest and your true cost may exceed $45,000.
Why Credit Unions Beat Dealers
Credit unions are member-owned nonprofits — they have no incentive to mark up loan rates for profit. According to the National Credit Union Administration, credit unions average 1%–2% lower auto loan rates than banks and 2%–3% lower than dealer financing. On a $30,000 loan over 60 months, 2% lower rate saves approximately $1,900 total. For personal and student loan comparisons, see our Loan Calculator. Membership in most credit unions is easy — many allow anyone in a geographic area or affiliated employer to join.
Frequently Asked Questions
At 7.5% APR over 60 months with nothing down, a $35,000 car loan (plus taxes and fees) runs about $720–$760/month depending on your state's sales tax. With a $5,000 down payment, the loan drops to approximately $30,000–$32,000 financed and your payment falls to $610–$650/month. At the same rate over 72 months, payments drop to $520–$560/month but you pay about $2,000–$3,000 more in total interest.
Almost always your bank or credit union. Dealers earn profit on financing by marking up your rate above what they secured. If they got 6.0% from the lender, they may quote you 7.5%. Always get a pre-approval from your credit union or bank before visiting the dealership — credit unions typically offer the lowest auto loan rates. The one exception: manufacturer promotions offering 0% or very low APR on specific models that beats any external financing.
Rarely. The lower payment is appealing, but you pay significantly more interest and you are underwater (owing more than the car is worth) for 2–3 years. If the car is totaled without GAP insurance during that period, you owe more than insurance pays out. Stick to 60 months maximum for new vehicles, 48 months for used. The only case for 72 months is if the interest rate is near 0% through a manufacturer promotion and you invest the monthly savings.
For the best new car rates (5%–6.5%), you generally need a 720+ FICO score. With 680–719, expect rates of 7%–9%. Below 650, subprime rates of 12%–20%+ apply. On a $30,000 loan over 60 months, the difference between a 5.5% rate and a 14% rate is about $165/month and $9,900 in total interest. If your score is below 680, consider waiting 6–12 months to build your score before buying.
A trade-in reduces the amount you finance, lowering your payment and total interest. But be careful: dealers often undervalue trade-ins and then offer a low interest rate or high vehicle price to compensate. Get your trade-in value appraised at CarMax, Carvana, or KBB Instant Cash Offer before walking into the dealership. These take 30 minutes and give you a real cash offer the dealer has to beat. Never let the dealer know your trade-in situation until after you've agreed on the new vehicle price.
