Icon CheckLast updated: September 22, 2022

The Best New Car Loans of 2022

Get the lowest rates whether you have good or bad credit.

If you can’t afford to pay for a new car all at once (not many people can), you’ll need to take out a car loan. When you shop for new car loans, you have a few options: You can get dealer financing, bank financing, credit union financing, or financing from an online lender like Capital One. We recommend shopping the entire market and avoiding dealership financing, which tends to have the highest interest rates.

Auto loan providers offer different rates depending on your credit history, vehicle, income, and other factors. The same provider might offer different annual percentage rates (APRs), term lengths, and loan amounts to different people. The following providers are the best for new car loans in general, but to find the best loans for your needs, you’ll need to apply and get pre-qualified.

Our Top Picks

Best Overall: Auto Credit Express

Available across the U.S. and Canada, Auto Credit Express offers loans for those with good or bad credit, with high ratings from the Better Business Bureau and TrustPilot.

Best Interest Rates: LendingTree

With LendingTree, you can shop the entire market at once to compare APRs, loan amounts, and term lengths from multiple providers. Interest rates start at only 0.99 percent, the lowest we’ve seen from any car loan provider.

Summary of the Best High-Risk Auto Insurance

Comparison of the Best Auto Loans for New Cars

Insurance company Auto Credit Express LendingTree Bank of America PenFed Credit Union
Ranking 1st 2nd 3rd 4th
Best for Overall Lowest interest rates Bank loans Credit union loans
Age of the company (in years) 23 26 240 87
Loan provider or aggregator Aggregator Aggregator Loan provider Loan provider
Loan term Varies by lender 12-84 months Not disclosed 36-72 months
Minimum APR Varies by lender 0.99% 3.89% 4.24% for new cars, 50.4% for used cars
Loan amounts Varies by lender Varies by lender, but up to $4 million or a maximum LTV ratio of 125% Minimum $7,500, or $8,000 in Minnesota $500-$150,000
BBB accreditation? Yes Yes Yes No
BBB rating (A-F) A+ A+ A+ A+
Trustpilot rating (out of 5) 4.6 4.6 1.3 4.6

Detailed List of the Best Auto Loans for New Cars


Auto Credit Express Logo

1. Best Overall: Auto Credit Express

If you want to shop for multiple loan providers at once, check out Auto Credit Express. It’s not a lender itself, but it can pre-qualify you for loans with multiple lenders. That way, you can shop the entire market in one place without filling out a million online forms.
Who It’s Best For

  • Anyone who wants low interest rates
  • Anyone who lives in the U.S. or Canada
  • Anyone with poor credit but proof of income, eligibility, and so on
  • Anyone who has filed for bankruptcy

Who It’s Not Best For

  • Someone with bad credit and a monthly income of less than $1,500 to $2,000 from a single source
  • Non-residents of the U.S. or Canada
  • Someone with bad credit who has only been at their current job for less than six months
  • Someone with good credit, as they can find lower APRs elsewhere

Good for Bad Credit

If you have bad credit, expect to find higher APRs. You’ll be considered less trustworthy than someone with good credit. Some loan providers have minimum credit scores and won’t cover you at all if you don’t reach their threshold. Auto Credit Express is ideal for someone with bad credit. While APRs, loan amounts, and terms will vary by lender, you can find an auto loan from Auto Credit Express if you can prove the following:

  • At least half a year at your current job
  • At least three years of work history
  • No large gaps in your employment
  • Monthly income of at least $1,500 to $2,000 from a single source
  • A working landline or cell phone contract in your name
  • Residency
  • 6-8 personal references, including their phone numbers, names, and addresses

Auto Credit Express also has options for people with no credit and people who have filed for bankruptcy.

Great Ratings

Auto Credit Express has accreditation and an A+ rating from the is accredited by the Better Business Bureau (BBB). The company’s rating is partly based on the following factors.

  • Advertising issues: Auto Credit Express is truthful in its advertising and uses the BBB name correctly.
  • Amount of time in business: Auto Credit Express’s 23 years in business speak to its reliability.
  • Complaint history with the BBB: The company has only had 10 closed customer complaints in the past three years, and two closed in the last year. This is a low number compared to other loan aggregation companies.
  • Failure to honor BBB commitments: The BBB does not list any mediations or arbitrations that it has failed to settle with Auto Credit Express.

Military Financing

If you’re an active member of the military, reservist, veteran, or family member of any of those, you could receive special military financing and discounts. You’ll see lower APRs and down payments, better loan terms, and more approvals.1 While you’re at it, check out the best auto insurance for those connected to the military.


LendingTree Logo

2. Best Interest Rates: LendingTree

Like Auto Credit Express, LendingTree is an auto loan aggregation service that lets you view multiple offers from different lenders at once. LendingTree is better for those with good credit, as it offers the lowest interest rates of any service we’ve seen, with APRs starting at 0.99 percent. Not everyone will qualify for this super-low APR, but if you have a great credit score, LendingTree is a fantastic option.
Who It’s Best For

  • Someone who wants to compare rates from multiple providers at once
  • Someone who wants an APR as low as 0.99 percent
  • Someone who wants an LTV ratio up to 125 percent
  • Someone who wants excellent customer service

Who It’s Not Best For

  • Someone who wants a 24/7 call center

Low APRs

LendingTree has the lowest minimum APR we’ve seen from any loan provider or loan aggregator, at only 0.99 percent. This is a solid option for someone who has great credit, is gainfully employed, and has a high income. If that’s not you, keep in mind that LendingTree doesn’t have a minimum credit score requirement and can connect you with a provider that will accept your score or lack of score.

Variety of Term Lengths

Since LendingTree lets you shop multiple lenders at once, you’ll be able to find loan terms from 12 to 84 months, or one to seven years. Of course, the longer your loan term, the smaller your monthly payment will be. However, a longer term length will result in more interest payments, so if you’re in a good spot financially, we recommend getting a short-term loan with a low APR.

Wide Range of Loan Amounts

Your loan amount will depend on your provider, but you can get up to $4 million from LendingTree, which is more than enough for the majority of American drivers. Another way to look at a loan amount is the loan-to-value (LTV) ratio. LendingTree has providers that offer up to 125 percent of your vehicle’s value. That means that if you total your car, you’ll receive 25 percent more than its current value to pay for a new car. This is helpful because your car’s value will have depreciated from when you first purchased it.

TIP:

We recommend buying gap insurance to cover the remainder of your auto loan if you total your car.


Bank of America Logo

3. Best New Car Loans From a Bank: Bank of America

Instead of shopping for an auto loan from companies you’re unfamiliar with, you can always have your current bank finance your vehicle. If you’re already a Bank of America rewards member, consider it a possible auto loan provider.
Who It’s Best For

  • Bank of America members, who will get discounts of 0.25 to 0.5 percent on interest rates
  • Anyone in the U.S., including Washington, D.C.
  • Someone who owns a vehicle less than 10 years old with less than 125,000 miles on it
  • Someone who wants to apply for an auto loan online and get approved within a minute

Who It’s Not Best For

  • Someone who wants a minimum APR of less than 3.79 percent for a new car
  • Someone who wants a loan under $7,500 (or $8,000 in Minnesota)
  • Someone with a car that’s over 10 years old or has more than 125,000 miles on it
  • Someone with a vehicle valued at less than $6,000

Discounts for Members

If you’re already a member of Bank of America’s Preferred Rewards program, you can enjoy discounts on your auto loan anywhere from 0.25 to 0.5 percent, depending on your membership level.

Factor Gold Platinum Platinum honors
Combined balance range in BoA deposit and/or Merrill investment accounts $20,000-$49,999 $50,000-$99,999 $100,000-$1,000,000
Car loan interest rate discount 0.25% 0.35% 0.5%

Membership is available in all parts of the U.S., including Washington, D.C. You’ll benefit from Bank of America’s 240 years in business and the same customer service you already enjoy as a member.

DID YOU KNOW?

BoA has an A+ rating with the Better Business Bureau and has been accredited for 74 years.2

Easy and Fast Approval Process

Applying for an auto loan from Bank of America only takes a minute. Simply provide the following information online:

  • Loan type
  • Car year
  • Make
  • Model
  • Mileage
  • Trim
  • Vehicle identification number (VIN)
  • Loan amount (between $7,500 — or $8,000 in Minnesota — and $9,999,999.99)
  • Loan term (48, 60, or 72 months)
  • Name
  • Address
  • Phone number
  • Email address
  • U.S. citizenship status
  • Social Security number
  • Date of birth
  • Employment status
  • Employer name
  • Occupation
  • Time employed
  • Yearly income
  • Housing status
  • Monthly housing payment

Once you get approved, the offered amount will be locked in for 30 days, so you have time to think about it without losing the best interest rates. You can finish the process entirely online.

Trustworthy Institution

BoA has been in business for 240 years. It is BBB-accredited with an A+ rating, and one of the advantages of going with a traditional bank is its reliability. BoA has been BBB-accredited since 1949.

BoA has a high number of customer complaints due to its vast customer base, but it has closed 7,000 of them in the past three years, and 2,495 of those in the past 12 months. While customer complaints are inevitable, we appreciate how BoA resolves them.


PenFed Credit Union Logo

4. Best New Car Loans From a Credit Union: PenFed Credit Union

Some people use credit unions rather than traditional banks as their financial institutions. If you prefer a credit union to a bank or traditional lender, consider Pentagon Federal Credit Union, or PenFed. With an A+ rating from the BBB and a 4.6 out of five on Trustpilot3 PenFed is a trustworthy auto loan provider.
Who It’s Best For

  • Someone who wants an average APR of 3.44 percent
  • Someone who wants to save an average of $334.17 on their monthly auto loan payments
  • Someone who wants to purchase gap insurance and extended vehicle coverage along with their auto loan
  • Someone who wants to pay off their loan in 36 to 72 months

Who It’s Not Best For

  • Nonmembers of the PenFed Credit Union
  • Someone who wants 24/7 phone support
  • Someone who wants their auto loan provider to be accredited with the BBB
  • Someone who wants to pay off their loan in less than 36 months

Monthly Savings

On average, people who get their auto loans from PenFed save $334.17 a month. With loan terms anywhere from 36 to 72 months, the union offers an average APR of 3.44 percent for new cars and 4.84 percent for used cars. Rates will be lower if you select a shorter term.

Add-ons

PenFed offers other financial protections aside from auto loans.

  • Gap insurance: Did you know vehicles lose 10 percent of their value as soon as you drive them off the lot, plus another 15 to 25 percent each year on average?4 If your car is totaled and you lack gap insurance (“gap” standing for “guaranteed asset protection” in this case), you’d be responsible for the remainder of the loan. That’s why PenFed offers this insurance — to cover the difference between the car’s actual cash value and its loan amount. PenFed members receive an additional $1,000 toward the replacement vehicle for $449. The maximum loan amount is $100,000 with a maximum 84-month term and a maximum gap loss of $50,000.
  • Deductible reimbursement: Along with gap insurance, you’ll get a deductible reimbursement of up to $500, so long as your vehicle is owned, titled, registered, and insured. It even covers unlimited losses within a year, so you can get reimbursed for $500 of your comprehensive or collision deductible.
  • Extended vehicle coverage: Your manufacturer’s warranty may not offer enough protection or a long enough term. To supplement it, you can buy an extended warranty from PenFed.
Feature Easy Street Protection for Newer Cars Easy Street Protection Main Street Protection
Eligible vehicle model years 2 or newer 8 or newer 8 or newer
Eligible miles on odometer 0-15,000 75,000 or under 75,001-125,000
Length of coverage 6 years or 100,000 miles, whichever comes first 5 years or 100,000 miles, whichever comes first 3 years or 36,000 miles, whichever comes first
24-hour roadside assistance Yes Yes Yes
Reimbursement for repair costs after manufacturer’s warranty expires Yes Yes Yes
Towing Yes Yes Yes
Rental car reimbursement Yes Yes Yes
Pricing for standard vehicles $995 $1,495 $1,495
Pricing for premium and hybrid vehicles $995 $2,995 $2,995
  • Debt protection: What happens if you experience a death, disability, firing, or layoff and can’t pay your auto loan? PenFed offers debt protection for these cases. If you were laid off from your job, for example, debt protection would cancel your loan balance and payments without any added interest or penalties.
Feature Death Involuntary unemployment Disability
Plan 1 coverage Yes Yes Yes
Plan 2 coverage Yes No Yes
Plan 3 coverage Yes No No
Aggregate loan balance canceled $70,000 $24,000 $15,000
Maximum monthly loan balance canceled N/A $1,000 $1,000
Maximum number of payments canceled per occurrence N/A 6 12

Online Application

Getting an auto loan from PenFed is easy, and you can do it without leaving your seat. On their website, choose between a new or used vehicle loan. Then, complete a quick quiz about where you purchased your vehicle, the total amount you’d like to borrow, the term length you’d like, and some information about yourself, including your name, email, mobile phone number, address, birthday, Social Security number, employment status, income, and more.

Methodology

To compare the best new car loan providers, we looked at information from the providers/aggregators directly, as well as third-party ratings from the Better Business Bureau and Trustpilot, which aggregates customer reviews from across the internet. The company information we analyzed included the following:

  • Age of company
  • Loan term lengths
  • Minimum APR for new and used cars
  • Loan amounts
  • Maximum LTV ratios
  • Discounts
  • Average total interest savings
  • Average monthly savings
  • Penalties for late payments or prepayments
  • Required down payment or lack thereof
  • Average monthly savings
  • Application fee, if any
  • Add-ons like gap insurance and extended vehicle coverage
  • Availability in terms of states, age of the applicant, types of vehicles, residency, bankruptcy, income, credit score, vehicle mileage or age, and so on
  • How long the financial process takes
  • Customer service hours and experience
  • Other services the provider offers, like personal loans and lease buyouts

We analyzed private-party auto financing, auto lender aggregation services, and companies that offer a car-buying service. Exact loan offers will depend on your vehicle, credit report, and other factors. We prefer lenders with low APRs, flexible terms, and a wide range of loan amounts.

Frequently Asked Questions

A good rate for a new car loan right now is 1.79 percent for a 36-month term. As the term length increases, so does the APR, according to data from the Navy Federal Credit Union.

Term 36 months 37-60 months 61-72 months 73-84 months 85-96 months
New vehicle APR 1.79% 2.19% 2.29% 4.69% 5.59%

It’s better to get an auto loan from a bank than a dealership. Shop around for the lowest APRs from different auto loan providers. While getting an auto loan from a dealership is more convenient, finance charges can be high, and advertised low interest rates may only apply to those with good credit scores.

Whether or not it’s smart to pay off a car loan early depends on your loan provider. Some lenders will charge you fees for prepayment. However, if your lender doesn’t have a prepayment penalty, it is smart to pay off a car loan early to avoid paying more interest.

With a 750 credit score, you can get a car interest rate at around 3.65 percent for a new vehicle, according to Experian data.

Citations

  1. Military Auto Loans. Auto Credit Express. (2022).
    https://www.autocreditexpress.com/leasing_and_financing/auto_loans/military_auto_loans/

  2. Business Profile – Bank of America. BBB. (2022).
    https://www.bbb.org/us/nc/charlotte/profile/bank/bank-of-america-0473-100421

  3. PenFed Credit Union. Trustpilot. (2022).
    https://www.trustpilot.com/review/penfed.org

  4. Car Depreciation: How Much It Costs You. Carfax. (2021, Feb 3).
    https://www.carfax.com/blog/car-depreciation