The amount of the average car loan in the United States is affected by where borrowers live. The interest rates on loans and the down payments required for vehicle purchases also are impacted by consumers' credit scores. The overall cost of the average auto loan can vary significantly among banks and credit unions as well.
National Average
A quarterly analysis of trends in the auto industry by the TransUnion credit-reporting company shows the size of the average U.S. auto loan rose to $12,602 in the fourth quarter of 2010. According to TransUnion, that's $102 more than the average auto loan the company documented in the third quarter of the same year. TransUnion pulled the data for its analysis from 27 million consumer credit files the company says were chosen randomly.
State Averages
The TransUnion analysis indicates the largest auto loans are in Washington, D.C., where consumers borrow an average of $15,693. The second-largest amount borrowed is in Wyoming, where residents seek an average loan amount of $14,217. Nebraskans borrow the smallest amount to finance their vehicles at $10,998. TransUnion also found that auto-loan delinquency rates increased in 32 states since the third quarter of 2010. The company's delinquency data are based on the ratio of borrowers who are at least 60 days behind in making their car payments.
Subprime Borrowers
People lenders consider to be subprime borrowers usually need to come up with larger down payments to buy cars no matter what amount they're seeking to borrow. A 2011 article on the Edmunds auto-information website reports that subprime borrowers have low credit scores of 619 or lower, and will likely need at least a 20 percent down payment to buy a vehicle. Therefore, subprime borrowers may need about $2,520 for a down payment based on TransUnion's national average for auto loans.
Prime Borrowers
Borrowers with high credit scores can qualify for lenders' teaser rates on auto loans, which are the lowest interest rates that lenders usually advertise to attract customers with excellent credit histories. Edmunds reports that those low rates are given to people classified as prime borrowers who have at least a 680 credit score. Low interest rates may allow prime borrowers to take on auto loans that exceed the national average because low rates result in lower monthly payments. According to Edmunds, people with high credit scores on average received interest rates as low as 4.08 percent at some credit unions in December 2010. The lowest average rate was higher at banks, at 4.28 percent.
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