Average car loan interest rate for 800 credit score

Can you pay a car payment with a credit card?

There are a few ways to make a car payment with a credit card, whether you have a loan or a lease. But paying directly with a credit card probably won't be among them, as auto lenders generally will not accept credit cards. They may or may not even accept direct debit card payments. In order to make car payments with a credit card, drivers must instead jump through a hoop or two and do it indirectly.

Here's how to pay a car payment with a credit card:

• Mobile payment services: One way to pay your car loan or lease with a credit card is to use a mobile payment app such as Venmo or PayPal as a middleman. These applications allow you to transfer money from user to user, and you can fund them with a credit card.

  So, for example, you could use your credit card to pay a friend or family member through the app, and they can then make your car payment for you or give you the money to do it yourself. Just make sure you really trust the person, and be careful because payments may count as purchases or cash advances, depending on the service and the credit card issuer. But either way, there are fees involved. Venmo, for example, charges 3% of the transaction amount.

• Money transfer services: Companies like MoneyGram and Western Union allow you to directly pay a collection of participating billers, and you can fund the transaction with a credit card. However, this may be treated as a cash advance, which would mean expensive fees and interest charges would apply, in addition to the fees charged by the service. You can learn more about how this works from our explanation of how to transfer money from a credit card to a bank account.

• Balance transfer: Several major issuers allow you to transfer an auto loan balance to a credit card: Bank of America, Barclaycard, Capital One, Citi, Discover, PenFed, USAA, U.S. Bank, Wells Fargo and SunTrust. The average balance transfer credit card offers a 0% intro rate for the first 12-13 months and charges a 3% transfer fee.
• Cash advance: Credit card companies often give customers convenience checks, which they can use to pay for things using their credit line when plastic isn't accepted. But using such a check counts as a cash advance, which comes with an expensive fee and a high APR that kicks in right away. You can also do a credit card cash advance at an ATM using a PIN, if you'd rather get actual cash, but it will be just as expensive (if not more costly, thanks to ATM-owner fees).

The bottom line is that these options are far from ideal and should only be considered if you're in a real bind, or if you do the math and somehow find an opportunity to save. That could be the case if you're able to transfer part of an auto loan to a 0% balance transfer credit card, for example.  

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Does LendingClub offer auto loans?

Yes, LendingClub offers auto refinancing loans. These loans allow people with an existing car loan to pay off that loan and move the balance to LendingClub. The purpose of this is to lower the car loan's costs. LendingClub only refinances existing auto loans; they do not offer loans to buy a car outright.

Depending on your credit, income and other factors, a LendingClub auto refinance loan could be very cheap or very expensive. The APRs range from 7% to 24.99%, though there are no origination fees or prepayment penalties. There may also be a fee to transfer the title of your vehicle from your old lender to LendingClub, depending on where you live. At the very least, you'll need to fill out a Limited Power of Attorney (LPOA) form to make this switch. It's important to consider all of the loans' terms and requirements before making a decision on whether to apply.

LendingClub Auto Refinance Loan Offer:

• APR: 7% to 24.99%
• Loan size: $5,000 to $55,000
• Origination fee: $0
• Prepayment penalty: $0
• Other fees: Auto title transfer fees or other state fees (min/max not disclosed)
• Loan length: The current length of your auto loan OR 12 months longer
• Eligible vehicles: Personal vehicles with fewer than 120,000 miles that are 10 years old or newer
• Loans eligible for refinancing: Must have an outstanding balance of $5,000 to $55,000, be at least 1 month old, and have 24+ months of payments left
• Other requirements: Credit score of 510+ (reportedly); 18+ years old; U.S. citizen, permanent resident or immigration-visa holder; LPOA form to transfer auto title to LendingClub

If you want to see your chances of getting approved for a LendingClub auto refinancing loan before applying, you can get pre-qualified. This process won't affect your credit, and it'll show you the rates you might get if approved. Just select your state and click “Check Your Rate” to get started.

How good are LightStream auto refinance loans?

Adam McCann, Financial Writer

LightStream auto refinance loans are inexpensive, and they offer the potential for a lot of funding very quickly. In fact, auto refinance loans are some of the cheapest loans that LightStream offers, with APRs as low as 3.99%. Borrowers take out the loan from LightStream and then use it to pay off their existing car loan. This effectively “refinances” the car loan and can allow the borrower to pay off the balance at a lower interest rate.

LightStream's auto refinance loans reportedly require a credit score of at least 660 to qualify. For context, the credit bureau Experian states that the average auto loan APR for a new vehicle ranges between 7.52% and 14.41% for people with a credit score of 660. So LightStream's refinancing option is extremely cheap, even if you only qualify for the highest rate of 8.84%. There are several other important details to know about LightStream auto refinance loans, too.

LightStream auto refinance loan details:

• APRs: 3.99% - 8.84%
• Fees: None
• Loan amounts: $5,000 - $100,000
• Loan lengths: 24 - 84 months
• Approval/funding timeline: As soon as the day you apply; usually within 2 business days.

LightStream also has a few other great perks. The first is their “Rate Beat Program.” LightStream says they'll beat a rate a competitor offers you by 0.1 percentage points. But you'll need to prove you were approved for a loan with said competitor by 2 p.m. EST the business day before your LightStream loan gets funded. And if you're not completely satisfied with your loan, you can fill out a questionnaire and receive $100 back from LightStream.

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Should I use a personal loan or a car loan to buy a car?

Adam McCann, Financial Writer

Personal loans and car loans are both options when purchasing a vehicle, but car loans are usually the better choice because they tend to be less expensive. Car loans usually have APRs between 3% and 7%, while personal loans have a much bigger range of possible rates, at 6% to 36%. Another major difference between the two is that a personal loan can be used for just about anything, while a car loan can only be used for purchasing a car. Plus, personal loans are usually unsecured, while a car loan uses the vehicle you're purchasing as collateral.

The average size of a personal loan is $11,700, according to LendingTree. In contrast, the average new auto loan is $32,187, and the average used auto loan is $20,137. So it's possible you might not be able to borrow enough with a personal loan to finance your car purchase. Personal loans and car loans differ in several other major ways, too, like how long buyers have to pay them off.

Personal Loan vs. Car Loan:

Car loans are best for people who simply want to buy an automobile as inexpensively as possible, as car loans offer much lower interest rates than personal loans. Plus, the risk of repossession shouldn't be a concern if you know that you can comfortably afford the monthly payments.

Personal loans are best for people who are willing to pay higher rates in order to have the debt be unsecured. The lender cannot take your car. Instead, they will only be able to send your debt to collections. Or, they may eventually file a lawsuit to try to garnish your bank account or wages.

Both personal loans and car loans may be available to people who have bad credit. But it's a bit easier to get a car loan with bad credit since the lender has the power of repossession. Few reputable personal loan providers offer loans to people with bad credit. Some options include Avant and LendingPoint.

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Is car insurance cheaper if you lease or finance?

Leif Olson, Car Insurance Writer

Car insurance is generally the same price whether you lease or finance a vehicle. Both lenders and lessors normally require that you carry full coverage to protect the car (their asset) until the loan is paid off or the lease term ends.

Full coverage typically includes collision and comprehensive coverage, and at least the minimum insurance coverage required by state law. Some lenders and lessors will also require that you carry gap insurance to cover the “gap” between what the car is worth and what you owe on the loan or lease if the car is totaled.

Cheapest Insurance for Leased / Financed Cars

*Premiums assume a full-coverage policy for a 45-year-old safe driver in California; actual premiums will vary.

For help finding the best deals on full coverage, check out WalletHub's guide to the cheapest full coverage car insurance.