Reviewed by

Brian McKay

Brian McKay

Co-Founder & Lead Data Architect

Expertise

• Automated Online Rate Data Aggregation
• Location-Based Rate Tables
• Bank & Credit Union Health Safety Ratings
• Bank & Credit Union Star Ratings
• Finance Calculators

Brian is the Co-Founder of MonitorBankRates.com. For over 18 years, he has utilized his background in enterprise infrastructure to engineer proprietary systems that track rates from over 8,000 financial institutions.

Read Full Bio

| August 31, 2026 | 5 min read

Auto Loan Rates Move Back Up for New and Used Cars

Used auto loan rates rose 0.100 points to 6.603% this week and new auto loan rates climbed 0.088 points to 5.866%, reversing most of last week's declines. Used-car financing still carries a lower average rate than it did in mid-August.

Most of last week's drop in average auto loan rates reversed this week. Used auto loan rates rose 0.100 points to 6.603% APR, taking back most of a 0.166-point decline, and new auto loan rates climbed 0.088 points to 5.866%. Two weeks of large swings in opposite directions leave used-car financing slightly lower, and new-car financing slightly higher, than in mid-August. New and used rates now sit 0.737 points apart, about $8.60 a month on a typical $25,000 loan.

Lenders take back most of last week's rate drop

Auto loan rates by category, national average APR since late March

Average APRs from MonitorBankRates.com's nightly collection, the same series this report's figures come from, updated daily.

At 6.603%, used auto loan rates recovered most of what they gave up a week earlier, though they remain 0.066 points below their August 19 level. New auto loan rates rose to 5.866% and moved past their mid-August level. A big drop one week and a big rise the next says lenders are repricing in both directions, not settling on a direction, and nothing in this week's numbers settles that question either.

Rates on general auto loans, products lenders list without naming new or used, rose 0.024 points to 6.493%. As always with that group, lender mix moves its average as much as pricing does, so new and used figures remain more reliable guides to where car loan rates actually stand.

What financing $25,000 looks like this week

Financing $25,000 over 60 months at this week's used-car average works out to about $490 a month, roughly a dollar more than at last week's average. A new-car loan for that balance runs about $482 a month, so buying used adds about $8.60 a month from financing alone, before either vehicle's price enters the picture. Dealership incentives on new cars often stretch that difference further in practice than these averages show.

Change since August 25, by loan category (percentage points)

This report's averages, August 25 to August 31. Red bars rose.

Auto loan rates this week: August 25 vs. August 31

Car loans and a possible September rate hike

Speaking at the Jackson Hole symposium on Friday, Federal Reserve Chairman Kevin Warsh signaled more openness to raising rates than he had shown before, and futures markets responded by putting odds of a quarter-point increase at the September 15-16 meeting near 60%, up from about 40%. Car buyers should keep two facts straight about that possibility. A loan you already signed never changes; auto loans carry fixed rates, so a September hike would touch none of them. Offers on loans not yet signed are a different matter, since lenders fund at short-term rates and reprice when those move. None of this explains this week's increases, which happened with policy unchanged, the same way last week's declines did.

Price insurance for the exact car before you sign

Lenders require full coverage on a financed vehicle until it's paid off, so an insurance premium runs alongside every loan payment in this report. Where you live drives that premium far more than loan pricing varies: our MBR Auto Insurance Burden Index ranks all 50 states by how heavily car insurance weighs on drivers, average car insurance rates cover what drivers pay nationally, and drivers in this issue's spotlight state can start with our California car insurance rates page. Two similar cars can carry very different premiums, so a quote for the exact model belongs next to any loan offer you're weighing.

Shopping for a car loan in a choppy week

Two weeks of rates swinging in opposite directions is a good argument for ignoring weekly moves and shopping lenders instead. These figures average every credit tier and vehicle age, and a strong offer, often from a credit union, usually beats them by more than any week changes them; a well-qualified buyer financing a late-model used car routinely does better than 6.603%. Today's strongest offers are on our best auto loan rates page, buyers comparing local lenders can line up California auto loan rates against these national averages, and week-by-week movement for every category is on our auto loan rate history page.

Where this leaves car shoppers

Car loan rates went up this week after going down last week, and neither move tells a buyer much on its own. Lenders are repricing frequently and in both directions, which makes an approved offer in hand worth more than usual; your credit profile, your lender, and the age of the vehicle will move your number far more than any week on this page. Get a quote or two before the dealership hands you theirs.