As the cost of new vehicles continues to rise, many car buyers find themselves opting for used cars as a more affordable alternative. However, one crucial aspect that requires careful consideration when purchasing a used car is the monthly payment. Understanding average used car payment statistics can provide valuable insights into the financial aspects of buying a pre-owned vehicle. In this blog post, we will explore the trends, factors, and important statistics surrounding average used car payments, empowering you to make informed decisions while navigating the used car market. Whether you are in the market for a budget-friendly commuter car or a more luxurious ride, this blog post aims to shed light on what you can expect to pay and how various factors can influence the overall average used car payment.
The Latest Average Used Car Payment Statistics Explained
The average monthly car payment on a new vehicle in the U.S. is $550.
This statistic indicates that, on average, individuals in the United States pay approximately $550 per month for a new car. This figure represents the amount of money people allocate towards their monthly car loan or lease payment. It is important to note that this is an average, meaning that there may be individuals paying more or less than $550 depending on various factors such as car model, financing terms, down payment, and interest rates.
The average new vehicle auto loan hit a record high of $31,099.
The statistic “The average new vehicle auto loan hit a record high of $31,099” refers to the average amount of money borrowed by individuals to finance the purchase of a new vehicle. This statistic highlights that the average loan amount for new vehicles has reached a historically high level of $31,099. This suggests that consumers are increasingly willing to take out larger loans to purchase new cars, which could be attributed to factors like rising car prices and more lenient lending standards. This record high average auto loan amount indicates a growing trend of consumers relying on borrowing to afford new vehicles.
The average monthly car payment on a used vehicle in the U.S. is $393.
This statistic indicates that the typical monthly payment made on a used car in the United States is $393. It represents the average amount that individuals are paying each month towards the cost of purchasing a pre-owned vehicle. This figure takes into account various factors such as the total cost of the vehicle, interest rates, and the duration of the loan. It serves as a benchmark for individuals looking to buy a used car, providing them with an idea of the average monthly expense they can expect to allocate towards their vehicle payments.
86.3% of new cars and 55.5% of used cars were financed in 2019.
In 2019, 86.3% of new cars and 55.5% of used cars were purchased through financing. This statistic implies that the majority of new cars sold were financed, with only 13.7% being purchased outright. Similarly, more than half of the used cars sold were financed, indicating that a significant portion of buyers prefer to spread the cost of their vehicle over time rather than paying for it in full. This suggests that financing options play a crucial role in the automotive industry, enabling a larger number of individuals to afford and purchase cars.
In the second quarter of 2019, the average used vehicle loan was 64.27 months.
The statistic “In the second quarter of 2019, the average used vehicle loan was 64.27 months” implies that, during that period, the typical length of a loan for purchasing a pre-owned vehicle was 64.27 months. This suggests that consumers who were seeking financing for used cars, on average, borrowed money for a little over five years to cover the cost of their vehicle purchase. The statistic can potentially provide insight into trends in vehicle buying and financing behavior, as well as serve as an indicator of consumer preferences and affordability for used cars.
The average car loan term is 67 months for new cars, and 65 months for used cars.
This statistic indicates the average duration of car loans for new and used cars. Specifically, new car loans have an average term of 67 months, while loans for used cars have a slightly lower average term of 65 months. This implies that the typical borrower who finances a new car chooses a longer repayment period compared to those purchasing a used car. The statistic provides insight into the prevailing loan durations in the automotive industry, highlighting the varying preferences and financial behaviors of consumers when it comes to financing their vehicles.
For customers with high credit (FICO score of 661-780), average auto loan rates for used cars is 6.15%.
The statistic indicates that for customers with a high credit score ranging from 661 to 780, the average interest rate for loans taken to finance used cars is 6.15%. This means that on average, borrowers with good credit in this range can expect to pay an interest rate of 6.15% on their auto loans. Lower interest rates are typically preferred by borrowers as they result in lower overall borrowing costs. Therefore, this statistic suggests that individuals with high credit scores have access to relatively favorable loan terms when purchasing a used car.
For customers with very good credit (FICO score 601-660), the average auto loan rate for used cars is 11.23%.
This statistic states that among customers with a FICO credit score ranging from 601 to 660, the average interest rate for auto loans on used cars is 11.23%. In other words, individuals with very good credit scores within this range are being offered loans at an average rate of 11.23% for purchasing pre-owned vehicles. This information provides insight into the prevailing interest rates for this specific group of customers and can be helpful for comparison purposes or decision-making when considering financing options for used car purchases.
For customers with fair credit (FICO score 501-600), the average auto loan rate for used cars is 17.63%.
This statistic indicates that among customers with fair credit, specifically those with FICO scores ranging from 501 to 600, the average interest rate for auto loans on used cars is 17.63%. This means that, on average, individuals in this credit range can expect to pay this percentage of interest on their auto loans. This information is relevant for customers with fair credit who are planning to purchase a used car and want to have an idea of the average interest rate they may encounter in the market.
For customers with bad credit (FICO score below 500), the average auto loan rate for used cars is 20.67%.
This statistic indicates that among customers with low creditworthiness (with a FICO score below 500), the average interest rate for auto loans used to purchase used cars is 20.67%. This implies that, on average, these customers would be charged an interest rate of 20.67% per year on their auto loan. This higher interest rate reflects the lender’s perception of increased risk due to the customers’ poor credit history, indicating that they are more likely to default on the loan or have difficulty making timely payments.
Average loan amount for used cars for the first quarter of 2021 is $22,191.
The statistic “Average loan amount for used cars for the first quarter of 2021 is $22,191” represents the average amount of money borrowed by individuals to finance the purchase of used cars during the first three months of 2021. This figure, $22,191, indicates the typical loan amount taken out by consumers in this time period and provides insight into the financial commitment individuals are making when purchasing a used car.
Subprime borrowers (501-600 FICO score) received auto loans of, on average, $16,631 for used cars.
This statistic indicates that individuals with subprime credit scores, ranging from 501 to 600 on the FICO scoring system, were approved for auto loans with an average amount of $16,631 specifically for purchasing used cars. FICO scores are commonly used by lenders to assess an individual’s creditworthiness, and lower scores suggest a higher risk of defaulting on loan payments. Subprime borrowers typically face more challenges in obtaining loans and may be required to pay higher interest rates compared to borrowers with better credit scores. Therefore, this statistic highlights the average loan amount that subprime borrowers were able to secure for purchasing used cars.
In 2019, 55.5% of used-car buyers financed their vehicles.
The statistic states that in the year 2019, approximately 55.5% of individuals who purchased used cars opted to finance their purchases. This implies that more than half of the buyers chose to seek financial assistance, such as a loan, to pay for their vehicles instead of making an outright cash payment. This information suggests that financing has become a common and popular method among used-car buyers to manage the cost of their purchases.
The average amount financed for a used car is around $22,000.
This statistic indicates that, on average, individuals who purchase a used car are financing approximately $22,000 for their purchase. The “average amount financed” refers to the total loan amount that individuals are taking out to cover the cost of buying a used car. It suggests that a significant number of people are choosing to finance their car purchases rather than paying the full amount upfront. By providing this average value, the statistic helps to quantify the typical financial commitment made by individuals when purchasing a used car on credit.
In Q1 2021, used-vehicle loan amounts rose 10.8% year-over-year, the largest increase ever recorded.
The statistic states that in the first quarter of 2021, the loan amounts for used vehicles increased by 10.8% compared to the same period in the previous year. This increase is the highest ever recorded, suggesting a significant surge in the borrowing amounts for purchasing used cars during this time. This statistic indicates a strong demand for used vehicles and a willingness among consumers to take on larger loans to finance their purchases, potentially reflecting favorable market conditions or changing preferences for more affordable transportation options.
The average loan amount for a used light truck in Q1 2019 was $20,598.
The statistic ‘The average loan amount for a used light truck in Q1 2019 was $20,598’ indicates that during the first quarter of 2019, the typical amount borrowed for financing the purchase of a used light truck was $20,598. This figure represents the mean loan amount and provides an insight into the general level of borrowing occurring in the market for used light trucks during this specific time period.
Conclusion
In conclusion, the average used car payment statistics provide valuable insights into the financial landscape of purchasing pre-owned vehicles. We have seen that more and more people are opting for used cars due to their affordability and lower monthly payments. This trend is reflected in the steady increase in the average amount financed and the average monthly payment for used cars over the years. It is crucial to carefully consider one’s budget and financial goals when purchasing a used car, as higher monthly payments can have long-term financial implications. Additionally, understanding these statistics can help consumers negotiate better deals and make informed decisions when it comes to securing auto financing. By staying informed about average used car payment statistics, individuals can ensure a more financially sound and secure vehicle purchase.
References
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