Is 17% APR too high for a car loan?

"My partner and I just purchased a used car for $9,500. We financed through a credit union and the rate they gave us was 17%.

We both have credit scores in the 700s. Is 17% interest too high for a car loan?"

“A 17% interest rate is high for people with credit scores in the 700s.
But remember that a credit score isn’t the only determinant of your rate. Other factors include:
  • Debt-to-income ratio
  • Loan-to-value ratio
  • Age and value of the car
  • Monthly income
Factor all of these in and 17% might be a decent rate. Because it sounds like you didn’t shop around, chances are you can find a better rate elsewhere.
The best course of action is to keep paying on your current loan while simultaneously looking for lenders to refinance the vehicle.”
Eric Schad
Answered on May 21, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.

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