November Auto Loan Interest Rates Hit 21-Month Low
Edmunds analysts say Black Friday promotions helped suppress new auto loan interest rates last month, registering a year-to-date low of 5.5% and an 8.3% year-over-year decline.
Edmunds’ Jessica Caldwell predicted year-end purchases of large trucks such as the Toyota Tundra — and higher trim levels in every category — will push average transaction prices higher as interest rates decline.
Photo courtesy Toyota Motor Sales USA
SANTA MONICA, Calif. — The average interest rate for a new vehicle loan dropped to its lowest level of 2019 — and lowest level seen since February 2018 — in November, according to the car shopping experts at Edmunds.
The annual percentage rate on new financed vehicles averaged 5.5% in November, compared to 5.7% in October and 6% in November of 2018. Edmunds data reveals that 21.8% of shoppers who financed their vehicle purchases in November 2019 got an interest rate below 3%, compared to 18.6% of those who financed purchases in November 2018.
“Auto loan interest rates still aren’t as low as they were a few years ago, but it’s encouraging to see that shoppers are landing more attractive financing offers.”
“Shoppers who made it out to the dealership this November got to take advantage of some of the biggest bargains all year thanks to a combination of Black Friday and model-year selldown promotions,” said Jessica Caldwell, executive director of insights at Edmunds. “Auto loan interest rates still aren’t as low as they were a few years ago, but it’s encouraging to see that shoppers are landing more attractive financing offers as rates continue to trend downward.”
While interest rates declined, Edmunds experts note that new vehicle prices continued to rise in November. Edmunds data reveals that the average transaction price for a new vehicle climbed to an all-time high of $37,981 in November 2019, compared to $37,188 last year and $33,282 five years ago.
“We typically see a lift in large truck and luxury vehicle purchases at this time of year, but these rising vehicle prices are also a reflection of car shoppers opting for bigger vehicles with more options across the board,” said Caldwell.
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