How to Get Lower Interest Rate on a Car Loan

It’s not unusual for Indianapolis and Avon shoppers to ask us how to get a lower interest on a car loan. Can you lower the interest rate on a car loan at any point? Getting a lower interest rate on auto loans can give you savings you’ll see every month while saving you hundreds, if not thousands of dollars in the long run. Stop by Lafayette Volkswagen and ask us, “How can I lower my car loan interest rate?” Our finance team is happy to help!

How to Lower Your Car Loan Interest Rate

There are plenty of ways you can lower the interest rate on a car loan. Try any of these tips:

1. Check your credit score. Knowing your credit score can give you an idea of what interest rate you might be able to get.
2. Clean up your score. Report any errors you find on your credit report to make sure your score is accurate. If your on-time car payments have improved your credit score, you might be able to get a lower interest rate.
3. Check for Refinance Loans. Can you lower the interest rate on a car loan? Refinancing can help. Make sure you know the average interest rates for your credit score and loan amount. Be sure to compare rates and payment terms from multiple places and ask your current lender for a lower rate. If denied, let them know you’ve been offered lower rates elsewhere and ask if they’re willing to match or beat the lowest offer.
4. Enlist a cosigner. Having someone cosign for your loan in Noblesville might get you a lower interest rate on your loan, especially if you have bad credit.
5. Consider in-house financing. In-house financing means you’ll be making payments to the dealership instead of the bank. If you make your monthly payments on time, consistently, then you’ll also be able to get a higher credit score.

What is a Good Interest Rate?

Knowing how to get a lower interest rate on a car loan is part of the battle. The interest rate you receive depends on your credit score as well as the size of the loan. And while they can be negotiated, drivers can find an average interest rate ranging from 3.2% to 12.9%. Based off of credit scores, here are estimated interest rates:

• 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)

Get More Auto Financing Tips From Lafayette Volkswagen

Getting a lower interest rate on car loans is just one of the many ways the finance department at Lafayette Volkswagen is working hard to help you save money when you purchase a new or pre-owned vehicle from us. Our car-buying tips include plenty of helpful articles that will help you save money and anxiety over the car-buying process. Find out how to trade in a car that’s not paid off, and how to buy a car in another state if you’re coming to IN to enjoy our great prices and customer service. And, of course, you’re always welcome to contact us with your automotive financing questions.