In today's automotive market, with prices and rates on the rise, a 2.9% APR is a good deal. However, whether or not this is a good interest rate for you will depend on factors like market conditions, your credit background, and what type of manufacturer car incentives there are at a given point in time on the car you want. With the average APR hovering around 10% these days, looking for a 2.9% APR deal could save you money.
How Much Does 2.9% APR Cost?
On a $40,000 SUV, a 60-month (5-year) loan at 2.9% would cost approximately $3,018 in interest. On a 72-month (6-year) loan, it would increase to $3,629. We've even seen 84-month financing incentives that could translate to $4,245 in interest. The best deal for you may depend on your budget and comfort level when it comes to affordability.
Do You Qualify for a Low APR?
While there can be lower interest rates like 0% APR which require stellar credit scores, you may still need above-average credit to qualify for 2.9% APR. For example, according to a dealer incentive bulletin from Infiniti's captive financing company, the full-size QX80 SUV has a 2.9% APR financing deal for 60 months that requires a FICO score of over 720.
We recommend talking to your dealer about rate and loan term options for your unique situation. If you have bad credit, you may need to work with a dealer equipped to help customers with subprime credit. New car incentives can change monthly, and the latest deals usually come out at the very start of the month.
Negotiate For Your Best Rate
To improve your odds of negotiating the best rate, consider getting pre-qualified for a loan in advance. You can also try and negotiate certain aspects of your loan to make it more affordable, by asking the dealer to make a bargain on things like your interest rate or your down payment.
Doing your homework could help you avoid being surprised by a higher rate than you expect. In some cases, dealers may have relationships with banks that enable them to offer lower rates than you can get on your own.
Meghan Carbary Automotive Content Editor
Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.
