Car Deal Canada

Car Deal Canada
Current Car Loan Rates Canada

Current Car Loan Interest Rates in Canada

Take a look at all of the current used vehicle interest rates in Canada. Pick the one you like and go through our quiz to find out if you pre-qualify for one of the lowest car loan rates in Canada

Take a look at all of the current used vehicle interest rates in Canada. Pick the one you like and go through our quiz to find out if you pre-qualify for one of the lowest car loan rates in Canada


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Current Lowest Car Loan Interest Rate in Canada

Current Lowest Car Finance Interest Rates in Canada

View the car loan bank interest rates below and select the one you want

Get the Lowest Car Loan Rates Canada with RBC Car Loan Rates

7.49% - 9.99%


National Bank of Canada
National Bank of Canada

7.49% - 9.99%


CIBC car loan rates

7.99% - 9.99%


Scotia Dealer Advantage

7.99% - 11.73%


Desjardins Car Loan Interest Rate

8.99% - 10.49%


General Bank Of Canada Car Loan Rates
General Bank Of Canada

8.99% - 10.99%


BMO Current Car Loan Rates Canada

8.99% - 10.99%


Current TD CAr Loan rates in Canada
TD Bank

8.89% - 29.99%


Eden Park
Eden Park

8.99% - 23.99%


Source One rates
Source One

8.99% - 29.99%


Rifo Car Loan Rates Logo

9.99% - 24.99%


Axis Auto Finance
Axis Auto Finance

9.99% - 31.99%


Scotia Dealer Advantage
Scotia Dealer Advantage

10.99% - 29.99%


iA Auto Finance Car Loan Rates
iA Auto Finance

10.99% - 29.99%


Auto Capital
Auto Capital

10.49% - 23.99%


Northlake Financial Car Loan Rates
Northlake Financial

11.99% - 29.99%


Santander Consumer
Santander Consumer

12.49% - 29.99%


Lowest Car Loan Rates Canada with vehicle interest rates

The Lowest Car Loan Interest Rates in Canada

Unlock the road to unbeatable car loan Interest rates in Canada with Car Deal Canada! Our expertise empowers you to secure the lowest interest rates, making your dream car a reality. We understand the significance of favourable loan terms, offering a streamlined process that matches your financial profile with the best rates available. No matter what the Bank of Canada rate is we will make sure you are getting the best one possible for your situation. 

With a network of trusted lenders and years of industry insight, Car Deal Canada ensures you drive away with not only a fantastic vehicle but also a fantastic deal. We also created an easy-to-use calculator so you can input your chosen rate from above and figure out your potential payments.

Used Car Loan Rates

Used Rates will always be higher then new cars due to the higher risk with older vehicles

New Auto Loan Rates

New car loans always get the best rate. This is where you can potentially qualify for 0% with certain dealers

Canadian Vehicle Rates

Canadian rates will depend on what the current bank of canada rate is

Car Finance Rates

Financing a Car with Car Deal Canada is a great way to build credit and save money with lower rates

Car Loan Interest Rates With a Click Of a Button

At Car Deal Canada, our dedicated team of auto financing specialists is ready to assist you in getting the lowest car loan and finance rates in Canada

Have Questions About Auto Loans & Rates?

The average interest rate on a car loan can vary significantly depending on whether you are financing a new or used vehicle. According to Experian data, as of Q3 2022, the average rate on a new car loan was 5.07% while the average rate on a used car loan was 8.22%. Rates are also heavily influenced by your credit score – borrowers with excellent credit tend to qualify for rates below 3%, while those with poor credit may pay over 15%. When shopping for a car loan, be sure to compare rates from multiple lenders to find the best deal. Focusing on the APR and not just the monthly payment can save you significantly on interest charges over the life of the loan.

Your credit score is one of the biggest factors lenders use to determine your interest rate on a car loan. Borrowers with higher credit scores are seen as lower risk and are rewarded with lower interest rates. According to Experian, here are the average used car loan rates by credit score range as of Q3 2022:


– 800-850 credit score: 3.25%

– 740-799 credit score: 4.33%

– 670-739 credit score: 7.44%

– 580-669 credit score: 13.95%

– 500-579 credit score: 16.86%

– 300-499 credit score: 18.00%


So if your credit score is considered excellent (740+ according to FICO), you can expect to qualify for the lowest rates. If your score is fair or poor, you will pay a significantly higher rate that can cost thousands in extra interest charges over the loan term.

To qualify for 0% APR car loan financing, you typically need to have an excellent credit score of at least 720 or higher. Most 0% interest auto financing offers are reserved for borrowers with prime credit. This incentivizes buyers with strong credit to finance their new car purchase through the automaker’s financing division. That said, some manufacturers may offer short-term 0% financing deals even to non-prime borrowers as a sales promotion. But the standard 0% rate incentives on new cars will require a credit score in the good to excellent range.

The lowest interest rates on car loans are generally below 2%. To qualify for a rate this low, you’ll typically need outstanding credit – usually a FICO score of at least 750. Auto lenders and manufacturers sometimes offer promotional rates at 1.9%, 1.0% or even 0.0% APR. But these ultra-low rates only go to borrowers with pristine credit. If your credit is “very good” instead of exceptional, expect rates around 3-5%. Anything below 5% on a used car loan requires strong credit. Compare rates from multiple lenders to find the lowest rate you qualify for

It may be tempting to extend your car loan term to 72-84 months to get a lower monthly payment, but this isn’t usually the wisest financial move. Longer loan terms mean you’ll be paying more interest charges over the life of the loan. For example, on a $25,000 car loan at 4% interest:

– A 60-month loan has a $449 monthly payment and $1,940 in total interest paid

– A 72-month loan has a $377 monthly payment but $2,834 in total interest

Unless you absolutely need the lower payment, opt for the shortest term you can afford. Paying off the loan faster saves on interest and builds equity in your vehicle. Make an extra principal payment when possible to pay off a long-term loan early.

A down payment of at least 20% is recommended on a new car loan to get the best rates, while used cars may need 10-15% down. With more equity in the vehicle, lenders see you as less of a risk. A larger down payment also means you’re borrowing less, so you pay less interest over the loan term. If your budget allows, increasing your down payment from 10% to 20% can shave 0.5% or more off your interest rate. However, don’t drain your emergency savings just to make a larger down payment. Even 5-10% down can score you a competitive rate with good credit.

Yes, getting pre-approved for a car loan before visiting dealerships gives you significant negotiating power. Pre-approval locks in an interest rate and loan amount based on your credit, before you fall in love with a specific car. Dealers will often try to beat your pre-approved rate, helping you secure the best financing. Going in blind without being pre-approved means the dealer can control the financing process and terms. Pre-approval also shows the dealer you’re a serious buyer. Shop pre-approval rates from banks, credit unions and online lenders.

Auto loan terms typically range from 24 to 72 months for a new car, and 24 to 60 months for a used car. Longer terms of up to 84 months may also be available, especially through dealership financing. Shorter terms of 12 to 36 months are sometimes offered for lease buyouts or private party sales. Term length affects your monthly payment amount – longer terms have lower payments but higher interest charges overall. Aim for the shortest term that fits your budget to save on interest and build equity faster.

To calculate your estimated monthly car loan payment amount, you’ll need:

– Vehicle purchase price

– Down payment amount

– Interest rate on the auto loan

– Loan repayment term in months

Take the purchase price minus down payment amount to get your total loan amount. Then use an auto loan calculator to estimate your monthly payment based on the loan details. Online calculators make this process easy. Your actual payment may differ slightly due to fees and other factors. Use the calculator to compare payment options.

Paying points upfront can be a way to lower your car loan interest rate. One point equals 1% of the loan amount. So on a $20,000 loan, one point would be $200. Each point typically reduces your rate by 0.25%. Paying two points would knock 0.50% off your rate but cost $400. Determine if the upfront cost is justified by the interest savings. For example, if points lower your rate from 8% to 7% on a 5-year loan, you would recoup the costs in under two years through the interest savings.

Some common fees to look out for with auto loans include:


– Origination or acquisition fees (usually 0.5% – 1% of loan amount)

– Prepayment penalties if you pay off the loan early

– Documentation fees to process the paperwork (may be negotiable)

– Late fees if your payment is not on time (usually around $25-50)

– Returned check fees if your payment bounces ($25-35 typically)


Ask the lender to explain all fees associated with the loan offer. Avoid prepayment penalties since they limit your flexibility. And remember that dealers tend to charge higher fees than banks or credit unions.

Most lenders will approve you for up to 115% of a vehicle’s value including taxes and fees, though some may go up to 125%. With excellent credit, you may qualify to finance 100% of the car’s value plus taxes. The loan amount also depends on your income and existing debts. If your total monthly debts exceed 50% of your gross monthly income, lenders may reduce the amount you can borrow, even if your credit is great. Get pre-approved for a loan to better understand how much you can comfortably afford.

Refinancing your car loan can make sense if you can lower your interest rate significantly – usually by 2 percentage points or more. This saves you money each month and overall. Refinancing terms to reset from a longer loan to a shorter one can also help you build equity and pay off the loan faster. But refinancing comes with fees, so run the numbers to see if the savings outweigh the costs. A credit score improvement may make you eligible for better refinance rates. You can also refinance with another lender for improved terms.

Auto loan interest accrues daily based on your remaining principal balance and the annual percentage rate (APR). Each monthly payment goes first towards paying the interest charge for that period, and then the rest goes to reducing your principal. Since the principal gets smaller over time while the rate stays the same, your portion of interest paid also gradually decreases. This is called amortization. Auto loans use simple interest, not compound interest, so interest is not charged on past interest. Your total interest paid depends on the loan term, APR, and principal amount.

The total interest paid on a $20,000 car loan will depend on the interest rate, loan term, and any fees. Assuming no fees, here are some estimates at different rates:


– 5% APR on a 5-year (60-month) loan: Around $1,663 total interest

– 8% APR on a 5-year loan: Around $2,665 total interest

– 10% APR on a 6-year (72-month) loan: Around $4,658 total interest


So on a $20,000 loan at 10% APR for 6 years, you would pay about $4,658 in interest charges over the life of the loan on top of repaying the principal amount borrowed. The higher the rate and longer the term, the more interest paid.

Paying off your auto loan early allows you to save on interest charges and own your car free and clear. There are usually no prepayment penalties for early payoff of a car loan. To pay off early, contact your lender for the payoff balance amount, including any interest accrued since your last payment. Banks must accept an early payoff amount. Just beware of precomputed interest contracts that do charge an early payoff penalty. Paying extra each month can help you pay off the loan faster without penalty.

Auto loan interest is calculated using your principal balance, the annual percentage rate (APR), and the number of days between payments. Each monthly payment goes first to the interest accrued during that period. The interest owed is calculated by dividing the APR by 365 days to get the daily rate, then multiplying that daily rate by your principal balance, and by the number of days since your last payment. The remainder of your payment goes towards reducing the principal. This continues until the loan is paid off. Paying extra monthly can reduce your principal faster and lower your interest.

To qualify for the very best auto loan rates below 2%, you typically need a credit score of at least 760 and preferably 780 or higher. Here are the average used car loan rates by credit tier, according to Experian:


– Exceptional (781-850) – 3.25% APR

– Very Good (740-780) – 4.33% APR

– Good (670-739) – 7.44% APR

– Fair (580-669) – 13.95% APR

– Poor (500-579) – 16.86% APR


A score in the good range can still get you single-digit rates below 10% at many lenders. But excellent credit gives you access to the lowest rates. Check your credit reports and dispute any errors before applying.

To qualify for a car loan in Canada, most lenders will require that you:


– Are 18 years of age or older

– Are a Canadian citizen or permanent resident

– Have a valid Canadian driver’s license

– Have a steady source of income

– Have a good credit score, usually 660 or higher

– Have a low debt-to-income ratio, usually under 40%


Lenders look at factors like your income, existing debts, credit history and score, down payment, and the car you want to finance to determine if you qualify and what rate you will pay. Having a co-signer with good credit may help you qualify if you have limited credit history.

Getting pre-approved for a car loan in Canada is recommended so you know your budget before shopping. Here are the steps:


1. Check and improve your credit score if needed.

2. Shop rates from banks, credit unions, or other lenders.

3. Complete a loan application with required documents.

4. If approved, you’ll receive a pre-approval letter stating loan amount, rate, and terms.

5. Take the pre-approval letter to the dealer when ready to buy.


Being pre-approved makes the process faster at the dealership so you can drive your new car home sooner!

Car loans in Canada can range from 12 months to 8 years (96 months). Here are some of the most common car loan terms from Canadian lenders:


– 12-36 months – Best for used cars with higher interest rates

– 48 months – Average term for new cars

– 60 months – Common term for new cars with 0% financing deals

– 72-84 months – Allows lower payments but pays more interest


A longer term leads to lower monthly payments but higher overall interest paid. Opt for the shortest term you can afford to save on interest charges over the life of the loan.

Pre-approval from a bank often provides the best rates, while the dealership makes the loan process convenient. Compare options to decide what works best for you.


Potential advantages of bank financing:

– Lower interest rates, on average

– Pre-approval locks in the rate

– May offer better terms and flexible payment options


Potential advantages of dealership financing:

– One-stop shop for purchasing and financing

– Offers manufacturer incentives not available elsewhere

– May negotiate loan as part of overall deal

– Quick vehicle delivery, often same-day


Weigh rates, terms, incentives and convenience to choose the best loan option. Dealers may match or beat a rate you’re pre-approved for.

To get the best rate on a Canadian car loan:


– Have a credit score over 720

– Put down at least a 20% down payment

– Choose a shorter loan term such as 36-48 months

– Shop rates from multiple lenders

– Negotiate your rate by leveraging offers

– Buy new instead of used if possible

– Opt for a variable rate instead of fixed

– Enroll in auto-pay from your bank account


Taking steps to appear as the ideal borrower to lenders can maximize your chances of the lowest rate on your next auto loan.

When applying for a car loan, have these documents ready for the lender:


– Proof of identity – Driver’s license or other government-issued ID

– Proof of income – Recent pay stubs, tax returns, bank statements

– Proof of address – Utility bill, bank statement, or lease agreement

– Down payment – Receipt if already made, or bank statements showing funds

– Insurance documentation – To add lienholder if financing

– Completed application form

– Co-signer documents, if applicable


Having all documentation ready speeds up the application and approval process. Contact the lender beforehand to confirm exactly what documents they require.

Adding a co-signer with good credit can significantly improve your chances of qualifying if you have little credit history, low income, or a poor credit score.


Benefits of using a co-signer for a Canadian auto loan:

– Helps meet lender requirements for credit score and debt ratios

– Provides additional income to qualify for a larger loan amount

– Allows access to better interest rates reserved for prime borrowers

– Makes approval more likely from a wider range of lenders


The co-signer is equally responsible for repaying the loan. Consider carefully before asking someone to put their credit on the line.

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