Monthly car payments for new and used cars are at record highs. Auto loan interest rates may drop to their lowest levels since 2023. The cost of car ownership remains high due to insurance and maintenance expenses. Good credit scores are crucial for lower monthly payments. New cars have the highest monthly payments ever recorded, prompting longer loan terms. The average monthly payment for a new car is $772, while used cars average $570. Over 20% of new car payments exceed $1,000.

Auto loan rates for new cars range from 4.88% to 15.85%, based on credit scores. Used cars have rates from 7.43% to 21.60%. Longer loan terms and larger loan amounts for new cars drive up monthly payments. Despite average monthly payments of $748 for new cars and $532 for used cars, factors beyond the vehicle cost impact payments. Down payments reduce total borrowing amounts.

Calculating the total cost of owning a car involves more than just the purchase price. Consider insurance, maintenance, repairs, fuel costs, and depreciation. Making a down payment can lower monthly payments and total purchase costs. Smart choices, comparing rates, building credit, and being patient can lead to better auto loan rates. Shop around for the best deals.

Read more at Yahoo Finance: Average car payments in 2025: What to expect