Auto Loan Calculator - Free Car Payment Estimator (2026)

What Is a Good Interest Rate for a Car Loan in 2026?

A good rate depends on FICO band and whether the car is new or used. In Q1 2026, super-prime new-car loans averaged 5.18% and used averaged 7.66%, while prime averaged 6.84% new and 9.73% used, near-prime 9.62% and 13.72%, subprime 12.85% and 18.97%, and deep subprime 15.62% and 21.57% (Source: Experian State of Auto Finance Q1 2026, experian.com/automotive). If your score is 661–780, target below 7% for new and below 10% for used; above 780 you should see below 5.5% new. The spread between new and used remains about 2.5 to 4 points. For a same-silo comparison of borrowing costs, test a general installment with the Personal Loan Calculator and see how a larger down payment changes the loan with the Home Affordability Calculator logic applied to auto loan size.

New Car vs Used Car Loan Rates: What Is the Real Difference in 2026?

Used cars cost more to finance because collateral risk and valuation uncertainty are higher. For a $30,000 balance over 60 months, the payment and total interest gap is clear: at 6.84% new the payment is $592 and total interest is $5,520; at 9.73% used (prime used) payment is $642 and interest is $8,520, a $50 monthly and $3,000 total difference. For a $25,000 used loan at 12.85% subprime new-car equivalent, payment is $569 and interest is $9,140 versus $520 and $6,200 at 6.84% prime new.

The older the used car, the larger the premium: a 5-year-old vehicle at near-prime used 13.72% costs $104 more monthly than prime new. That premium often wipes out the lower purchase price. Certified pre-owned with a shorter term can offset the rate gap.

How Can You Lower Your Monthly Payment Without Paying More Interest?

Two levers lower payment, but they have opposite interest effects. Adding $1,000 to down payment on a 60-month loan cuts payment by about $18 to $19 and saves about $110 in interest at 7.1%, while extending the term from 60 to 72 months cuts payment by about $72 but adds about $1,080 in interest on $30,000 at 7.1%.

Financial planning guidelines suggest keeping total vehicle costs under 15% of take-home pay and the 20/4/10 rule (20% down, max 4-year term, costs under 10% of gross) when possible. Shopping three lenders, including credit unions that average 1% to 1.5% lower than captives, often beats extending the term. If you already have a loan, test the refinance math with the Mortgage Refinance Calculator logic applied to auto rates and model the trade-in equity impact with the net proceeds.

Should You Buy or Lease Your Next Vehicle in 2026?

Buying builds equity and ends with a paid-off asset; leasing pays for the steepest depreciation slice with lower monthly outlay. A $35,000 car losing 15% in year one ($5,250), 10% in year two ($2,975) and 8% in year three ($2,182) is worth about $24,593 after 3 years, a $10,407 loss. A typical lease payment of $450 for 36 months costs $16,200 with $0 equity, while buying at $595 for 60 months at 7.1% builds about $10,400 in equity after 3 years even after interest.

Leasing is generally the most expensive way to operate a car over 10 years because you always fund the steepest curve, and excess mileage at $0.25 per mile adds $2,500 for 10,000 extra miles. If you drive under 12,000 miles yearly, want a new car every 3 years and can write off business use, leasing can be rational. Over 15,000 miles yearly, buying wins mathematically. See the loss curve for your specific model with the Car Depreciation Calculator.