Average new auto loan interest rate hits 22-month low

Average interest rate on a new vehicle loan expected to fall for the third month in a row & hit a low point not seen since early 2018 as automakers, dealers extend holiday promotional offers.

SANTA MONICA, Calif.Jan. 3, 2020 /PRNewswire/ — The car shopping experts at Edmunds say the average interest rate for a new vehicle loan fell for the third month in a row in December, dropping to its lowest point since February 2018. The annual percentage rate (APR) on new financed vehicles averaged 5.4% in December, compared to 5.5% in November and 5.9% in December of 2018. Edmunds data reveals that 22.4% of shoppers who financed their vehicle purchases in December 2019 got an interest rate below 3%, compared to 20.4% of those who financed purchases in December 2018.

Car-buying platform Edmunds.com serves nearly 20 million visitors each month. With Edmunds.com Price Promise(R), shoppers can buy smarter with instant, upfront prices for cars and trucks currently for sale at over 10,000 dealer franchises across the U.S.

“Automakers and dealers gave new car buyers a lot of reasons to feel some holiday cheer in December,” said Jessica Caldwell, executive director of insights at Edmunds. “Everyone knows new car deals are usually sweetest at the end of the year, but it’s been a long time since financing offers were this good.”

Although interest rates took a dip, new vehicle prices are expected to hit near-record highs in December. Edmunds data reveals that the average transaction price for a new vehicle will climb to $38,377 in December, compared to $37,260 last year and $33,773 five years ago.

“The December numbers aren’t always indicative of  larger market trends because people tend to buy pricey luxury vehicles, trucks and SUVs this time of year. This drives up the average transaction price and lowers the average APR since these shoppers can usually qualify for the lowest promotional rates,” said Caldwell. “But the fact that rates have been on a steady decline for the last several months bodes well for more favorable financing conditions in 2020.”

More insight into recent auto industry trends can be found in the Edmunds Industry Center at https://www.edmunds.com/industry/insights.html.

New Car Finance Data

December 2019

December 2018

December 2014





Monthly Payment




Amount Financed








Down Payment




Average Transaction Price




Used Car Finance Data

December 2019

December 2018

December 2014





Monthly Payment




Amount Financed








Down Payment




About Edmunds

Edmunds guides car shoppers online from research to purchase. With in-depth reviews of every new vehicle, shopping tips from an in-house team of experts, plus a wealth of consumer and automotive market insights, Edmunds helps millions of shoppers each month select, price and buy a car with confidence. Regarded as one of America’s best workplaces by Fortune and Great Place to Work, Edmunds is based in Santa Monica, California, and has a satellite office in Detroit, Michigan. Follow us on TwitterFacebook and Instagram.