Remember to Include These Crazy Interest Rates in Your Car Budget

There are some really good signs that the car market is finally shifting back to favor the buyers. Dealers are sitting on a lot of inventory, and deals are especially hot on slow-selling EVs. Unfortunately, interest rates are still high and that can really make a difference as to what is affordable versus what is not.

According to Edmunds.com for the last six months, the average interest rate for a new car loan has been around 7%, whereas used car loans are averaging around 11%. Of course, keep in mind that these are overall averages that are calculated from folks with very low credit scores to very high. If your FICO is well above 700 you should do a bit better, but if you have some credit challenges you could be looking at a seriously high auto loan.

NerdWallet has a chart via Experian that provides a breakdown of average rates per credit profile.

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