How to Get a Lower Interest Rate on a Car Loan

How to Get a Lower Interest Rate on a Car Loan

Whether you’re saving up for a big purchase or you’re just looking to lower your monthly payments, you may be questioning,“can you lower interest rates on a car loan?” or “how can I lower my car loan interest rate?” The finance center at Orem Toyota is here to answer all your car finance questions and provide you with some tips for how to get a lower interest rate on a car loan. If you have any other questions along the way, don’t hesitate to contact us today!

How Can I Lower My Car Loan Interest Rate?

For those wondering, “can you lower the interest rate on a car loan?” There are a couple ways you can go about getting a lower interest rate on auto loans. Try some of these steps for your Lehi-area loan:

1. Check your credit score: One of the first steps for how to get a lower interest rate on a car loan is to be aware of your credit score. Before applying or re-applying for a loan, knowing what your standing is allows you to understand how much work on updating your score you need to do.
2. Boost your score: There are several ways you can boost your credit score, but it may take some time and work. Having a good credit score helps with getting a lower interest rate on auto loans.
3. Check for Refinance Loans: We’ll take a look at the average interest rates for your credit score below, but knowing this range helps you find the best loan for your situation. Take the time to compare rates and payment terms across different lenders, and even check with your current lender if there are lower rates. If they deny you, you have the chance to mention your other offers to see if they can match or beat that offer.
4. Enlist a cosigner: Another method for getting a lower interest rate on auto loans is by enlisting a trusted cosigner. This can be a good option if you have low credit.
5. Consider in-house financing: Instead of making payments to a bank lender, you can make payments to the dealership with in-house financing. Making timely and full payments helps bump up your credit score.

Average Interest Rates

Now that you have some tips for how you can lower the interest rate on a car loan, it’s a good idea to know what a good rate is for your credit score. Each grouping of credit scores will see an average interest rate range. Take a look at the estimated interest rate for each credit score range:

• 800 – 740: 3.2% interest rate (on average)
• 739 – 680: 4.5% interest rate (on average)
• 680 and below: 6.5% – 12.9% (on average)

OremToyota is Here for You Car Buying Tips and Tricks!

We hope this guide has you on your way to how you can lower your car loan interest rate. If you have more questions don’t hesitate to reach out to our knowledgeable team at Orem Toyota. You may also be interested in comparing bank vs dealership car loans, and for an idea of what your monthly payments would be at your average interest rate, take a look at our payment calculator tool.