Buying a car is a major investment, but it doesn’t have to drain your wallet—especially if you finance it wisely. Choosing the right lender can save you hundreds or even thousands over the life of a car loan. Whether you’re buying new, used, or refinancing, these 10 cheap car loan options in the USA offer competitive interest rates, flexible terms, and fast approvals for all kinds of borrowers.
1. PenFed Credit Union – Best Overall for Low Rates
APR starting at: 5.19% for new cars
Why it’s great: PenFed consistently offers some of the lowest interest rates nationwide—even for borrowers with average credit. With flexible loan terms up to 84 months and no hidden fees, it’s one of the top choices for budget-conscious buyers.
Perks:
Financing for new, used, and refinanced vehicles
No origination fees
Online pre-qualification available
2. LightStream – Best for Excellent Credit
APR starting at: 6.49% (with AutoPay)
Why it’s great: A division of Truist Bank, LightStream offers ultra-low rates to borrowers with excellent credit. There are no fees, and you can apply online and receive funding as soon as the same day.
Perks:
No fees at all
Rate beat program
Great for high-value or luxury vehicles
3. Capital One Auto Finance – Best for Pre-Qualification
APR starting at: 6.75% (varies by credit profile)
Why it’s great: Capital One’s Auto Navigator tool lets you pre-qualify with no credit impact and browse cars from partner dealerships with real rates. It’s user-friendly and perfect for first-time buyers.
Perks:
No impact on credit score to check rates
Large network of dealership partners
Easy online loan management
4. Consumers Credit Union – Best for Used Cars
APR starting at: 5.74% for used cars
Why it’s great: This Illinois-based credit union serves all 50 states and offers low rates on used vehicles. It’s ideal for anyone buying an older or higher-mileage car and looking to keep monthly payments low.
Perks:
Financing up to 125% of vehicle value
Long loan terms available
Membership open to all for $5
5. Bank of America – Best for Existing Customers
APR starting at: 6.29% (with discounts)
Why it’s great: If you’re a Bank of America client, you can qualify for rate discounts up to 0.5%. It’s great for those who want to manage everything in one place—checking, savings, and auto loan included.
Perks:
Quick online application
Special discounts for Preferred Rewards clients
Good for refinancing too
6. Carvana – Best for Online Car Buying and Financing
APR starting at: 6.85%
Why it’s great: Carvana is a one-stop shop where you can buy and finance a car completely online. It’s fast, convenient, and transparent, making it ideal for buyers who want everything done digitally.
Perks:
Get pre-qualified in 2 minutes
No hidden fees
7-day money-back guarantee on cars
7. Navy Federal Credit Union – Best for Military Members
APR starting at: 5.14% for new vehicles
Why it’s great: If you’re military, a veteran, or a family member, NFCU offers some of the lowest interest rates and flexible terms around. Customer service is also highly rated.
Perks:
Up to 100% financing
Great rates on both new and used cars
Refinance and lease buyout options available
8. AutoPay – Best for Loan Marketplace Options
APR starting at: as low as 5.89%
Why it’s great: AutoPay is a loan marketplace that connects you with various lenders to help you find the cheapest rate. It’s excellent for people who want to compare multiple offers at once.
Perks:
Pre-qualify in minutes
Loan offers from credit unions and banks
Great for refinancing and lease buyouts
9. LendingTree – Best Loan Comparison Tool
APR starting at: varies by lender and profile
Why it’s great: LendingTree is a top comparison site that lets you easily check and compare auto loan offers from multiple lenders. It’s best for people who don’t want to shop around manually.
Perks:
Access to a wide lender network
No fee to compare
Personalized offers within minutes
10. OpenRoad Lending – Best for Refinancing
APR starting at: 5.99% for qualified borrowers
Why it’s great: If you already have a car loan with a high interest rate, OpenRoad Lending could save you thousands by refinancing. They specialize in helping customers lower monthly payments or reduce total interest.
Perks:
Quick refinance process
Accepts borrowers with fair credit
No application fees
FAQs
1. How do I qualify for the lowest car loan rates?
To get the best rates, maintain a good credit score (above 700), provide a solid down payment, and opt for shorter loan terms. Pre-qualifying helps you see what you’re eligible for.
2. Should I get pre-approved for a car loan?
Yes! Pre-approval gives you a clear budget, makes negotiations easier at dealerships, and protects you from inflated dealer financing rates.
3. Is it better to finance through a bank or a dealership?
Banks and credit unions often offer lower rates than dealerships. However, dealerships may offer promotional 0% APR deals for qualified buyers. It’s worth comparing both.
4. How long should my car loan be?
Shorter loans (36–48 months) come with lower interest overall, but higher monthly payments. Choose the shortest term you can comfortably afford to minimize interest.
Conclusion
Finding a cheap car loan in 2025 doesn’t have to be complicated. From top credit unions to digital marketplaces, there are many lenders offering affordable, flexible auto financing to fit your budget. Always compare rates, consider pre-qualification, and don’t be afraid to negotiate with dealers using a pre-approved offer. A smarter loan today means more savings tomorrow.