Car Loan APRs Now Exceed Great Recession Levels, Data Shows

The cost of borrowing for a car has climbed past a troubling milestone. According to recent figures, the average APR on an auto loan today is higher than it was during the Great Recession. This comes alongside record-high new car prices, record-high monthly payments, a sharp rise in loan delinquencies, and repossessions up by double digits.

For anyone eyeing a new Mazda CX-5 or any other vehicle, the key question is: what APR can you expect, and what is too high? With many borrowers taking on 70-month loans, rising living costs, high borrowing costs, and shrinking savings, careful financial planning is more essential than ever.

Knowing your limit before signing is critical.

APR, or Annual Percentage Rate, reflects the total yearly cost of borrowing, including interest and fees, unlike the simple interest rate. A lower APR means cheaper financing. Your credit score is the biggest factor in determining your APR. 30% on used cars. 77% for used.

Used car APRs run higher because resale value is harder to predict and breakdown risk is greater, though lower used prices can offset monthly costs. To secure a better rate, consider waiting out poor economic conditions, shopping around for lenders, improving your credit score or adding a co-signer, choosing shorter loan terms with a larger down payment, and avoiding dealer add-ons like extended warranties or gap insurance.

9% APR is high for new but average for used. 77% for used. A 20% APR is exceptionally high, usually tied to deep subprime credit. Sources: TopSpeed, HotCars, Experian, Investopedia, NerdWallet, Macrotrends.