What is a Good Interest Rate for a Car Loan?

Before hashing out your next loan deal, you might wonder, “What is a good interest rate for a car loan?” The truth is that a “good interest rate” might vary from person to person, depending on credit history. Those with higher credit scores can expect lower interest rates overall, while those with lower credit scores tend to qualify for much higher rates. John Holt Auto Group, Inc. has assembled a brief guide to help you navigate the loan process so you can shoot for the best interest rates possible. Let’s get started!

New and Used Car APR

When determining what is a good interest rate for a car loan, you’ll want to take a look at two things: your credit score and the Annual Percentage Rate (APR). Your credit score and the APR, or Annual Percentage Rate, will determine what your ideal interest rate will be in the Amber and Chickasha area. Compare the categories below:

What is the Average Interest Rate on a Car Loan?

The average interest rate on a three-year car loan is around 3% to 4.5%. However, this is just an average of all of the interest rates of all of the drivers in the country. Some have a higher rate; some have a lower rate. The key to getting a good interest rate is to apply for financing from multiple sources so you can pick and choose the most competitive deal for you.

How Do You Get the Best Interest Rate?

• Check Your Credit Score: You can check your credit score once per year for free from the three major credit bureaus. If you haven’t checked your credit score in a while, it’s a good idea to make an inquiry. This allows you to plan more effectively.

• Do Your Research: Now that you know your credit score, compare it to the APR chart above. Since a “good interest rate” can fall anywhere between 3.17% and 13.76%, this will help you narrow down your ideal interest rate range.

• Negotiate: Take the information that you have gathered and use it to negotiate like a pro. You know your credit score, and you know the appropriate interest rates for someone with your profile. If you think that a lender has room to improve their offer, bring out your research and make a case. But keep in mind that while your interest rate is important, it’s just one part of the package.

Get Expert Financing Advice with John Holt Auto Group, Inc.

Now you know, “What is a good interest rate for a car loan?” but what interest rates can you expect from lenders around Norman? The team at John Holt Auto Group, Inc. has plenty more car-buying tips to help you get the deal of a lifetime. Contact us with any questions about the financing process, or just stop by Chickasha. We’d be happy to help you find affordable financing for your next vehicle.