With no minimum credit score requirement, your goal when getting a car loan in Iowa should be to shop for the lowest interest rate and a term of 60 months or less.

Car insurance and loan super app Jerry has collected all the information you need to understand Iowa’s car loan process. We’ll even explain how your credit score factors in when it comes to finding an auto loan in the Hawkeye State.

How to get a car loan in Iowa

Not many people can pay cash for a new set of wheels—so if you’re in the market for a car in Iowa, you’ll also likely be in the market for a traditional car loan. A loan from a bank, a credit union, or the dealership where you bought your car allows you to pay off your car over time rather than shelling out all the cash up front.

Here’s what to expect when you take out a car loan in Iowa:

You may need to make a downpayment, though many lenders in Iowa offer low- or no-down-payment lending options
You’ll choose a loan term (i.e., how long your loan lasts) and settle on an interest rate with your lender
You’ll make monthly payments of both principal and interest according to your annual percentage rate (APR) over the loan term

The car loan you choose will depend on a number of factors, including your credit score, the loan term you select, and what kind of car you’re buying. The table below will help you see what your APR and monthly payment might be with an Iowa car loan.

Credit Rating

Car Make	Average Annual Interest Rate	Average Monthly Payment
ACURA	8.13	$360
ALFA ROMEO	8.19	$360
ASTON MARTIN	8.19	$360
AUDI	8.3	$361
BENTLEY	8.19	$360
BMW	8.74	$365
BUICK	8.22	$360
CADILLAC	8.47	$362
CHEVROLET	8.22	$360
CHRYSLER	8.5	$363
DODGE	8.33	$361
FERRARI	8.19	$360
FIAT	8.25	$361
FORD	8.22	$360
GENESIS	8.19	$360
GMC	8.16	$360
HONDA	8.02	$359
HYUNDAI	8.22	$360
INFINITI	8.33	$361
JEEP	8.02	$359
Jaguar	8.19	$360
KIA	8.42	$362
LAMBORGHINI	8.19	$360
LEXUS	8.16	$360
LINCOLN	8.3	$361
LOTUS	8.19	$360
Land Rover	8.19	$360
MERCEDES-BENZ	8.19	$360
MINI	8.19	$360
MITSUBISHI	8.33	$361
Maserati	8.19	$360
Mazda	8.19	$360
NISSAN	8.28	$361
POLESTAR	8.19	$360
PORSCHE	8.33	$361
RAM	8.22	$360
ROLLS-ROYCE	8.19	$360
Subaru	8.19	$360
TESLA	8.61	$364
TOYOTA	8.02	$359
VOLKSWAGEN	8.22	$360
VOLVO	8.05	$359

Ready to look for a car loan in Iowa? Here’s what you need to do.

Check your credit

Start by checking your credit score. While there’s no minimum score requirement in Iowa, the higher your score, the lower the interest rate you can get. A credit score of 690-720 on the 300-850 scale used for FICO and Vantage scores is generally considered good, but a score of 760 or above may help you qualify for rates as low as 2% in Iowa. The national average interest rate on a car loan as of January 2022 is about 5%.

Use the table below to estimate your average interest rate and monthly payment based on your credit rating.

Credit Rating

Loan Terms	Average Annual Interest Rate	Average Monthly Payment
24	11.01	$696
36	8.42	$469
48	7.94	$362
60	7.87	$300
72	8.14	$261

Compare lenders

It may be tempting to take the first loan you find, but shopping around a bit will ensure you get the best rate you can find. Car dealerships often offer to handle your car loan for you, but they don’t always offer the best rates or terms.

Before you choose your car loan compare offers from at least three lenders. You want to make sure you’re getting the lowest interest rate, but you should also consider your approval odds and each lender’s servicing standards.

Many smaller lenders—and even some larger ones—sell their loans to other financiers or outsource their loan servicing, affecting the borrower’s ability to get help when they need it.

Choose your loan term

The loan term, or the length of time over which your loan payments are financed, is one of the most easily negotiated aspects of a car loan. Some lenders offer terms of up to 84 months, but these can be deceptively appealing.

The longer your loan term, the more interest you’ll wind up paying—so your loan will be more expensive in the long term. Your goal should be to secure the shortest loan term possible for your budget, ideally no more than 60 months.

Here’s how your APR and monthly payment could change based on your loan term in Iowa.

Credit Rating	Average Annual Interest Rate	Average Monthly Payment
Fair	15.76	$409
Good	8.24	$359
Very Good	5.07	$340
Excellent	3.88	$333

MORE: Should you get a 72-month car loan?

Get preapproved

Get preapproved to get the best deal. When you’re preapproved for a loan, you’re equipped with the knowledge of exactly how much you can borrow and how much you will pay monthly, so you can negotiate the best deal on your car.

A preapproval lets your dealer know you’ve done your homework and are serious about getting the best deal possible. Also, preapproval means you don’t have to rely on dealer financing, which can give you a lot more negotiating power and make the car-buying process easier.

Can you get a car loan in Iowa for a used car?

Yes, you can get a loan for a used car in Iowa. But here are a few things to keep in mind:

Interest rates on used cars are higher (often close to 8%)
Most lenders set limits on the age, mileage, and amount they will finance for a used car
If you’re looking for a small loan for a used car, a loan from a credit union might be your best option

Want to see how the age of your car could affect your car loan in Iowa? Take a look at this table.

Car Make

Car Year	Average Annual Interest Rate	Average Monthly Payment
2021	7.51	$304
2020	7.84	$307
2019	7.98	$307
2018	7.84	$306
2017	7.99	$307
2016	8.12	$308
2015	8.3	$309
2014	8.27	$378
2013	8.33	$379
2012	9.24	$510
2011	9.24	$510
2010	9.24	$510

MORE: Lemon laws in Iowa

Iowa car loan calculator

So, now you have all the information you need about how car loans work, how to choose your loan term, and how your car’s age and mileage could affect your lending options. Use Jerry’s car loan calculator to learn your average payment and interest rate for a car loan in Iowa based on your credit score, loan term, loan amount, and car make.

Remember, educating yourself on the average car loan details and the types of loans for which you might qualify puts you in a position to negotiate the best loan possible. Use this tool to get started today!

Car Make

Credit Rating

Loan Terms

Loan Amount

Average Annual Interest Rate	Average Monthly Payment
8.24	$360

MORE: Car sales in Iowa higher than pre-pandemic levels

How to find affordable car insurance in Iowa

Before you leave the lot in your new (or new-to-you) car, you’ll need to ensure you meet Iowa’s minimum requirements for car insurance.

The licensed broker and car super app Jerry makes it easy to get the insurance you need. In just 45 seconds, Jerry will scour more than 50 insurance companies and present you with the best quotes for your budget and coverage needs.

Once you pick the plan you like, Jerry will handle all your paperwork for your new coverage and can even help cancel your old policy. The average Jerry user saves $887 per year!

“Just for state minimum liability, I was getting quotes from $70 to over $100/month until I found Jerry. Now my car insurance is under $30/month, or $140 for 6 months. Thank you, Jerry!” —Federico S.

FAQs

What credit score is needed to buy a car in Iowa?

There is no minimum credit score to qualify for a car loan in Iowa, but borrowers with higher credit scores will qualify for better rates and terms than those with lower scores.

Will a bank give me a loan for a used car?

Maybe. Many banks offer car loans, but most set limits on the car’s age and mileage and minimums on the amount you have to borrow. If you’re looking for a loan on a low-priced used car, a credit union may be your best bet.