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?"
Answer provided by
Answered on May 21, 2021
“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.”
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