Key Insights to Steer Your Understanding
- With an eye-popping average car loan of $7,920, Texas ranks at the top nationwide.
- Though auto costs swing across regions, savvy borrowers can snag better deals by boosting credit scores and shopping around for lenders.
- Affordability hurdles persist for many motorists, fueling a rise in overdue car loan payments.
It’s not geography that chiefly dictates payments or delinquency rates; instead, the crux lies in creditworthiness, income stability, outstanding debts, plus the loan’s size and duration. Yet scanning these figures state-by-state provides a window into the wider economic pulse of each locale.
Over recent months, folks have found themselves borrowing heftier sums to put wheels under them. Rising loan amounts paired with soaring interest percentages have tightened the grip on vehicle ownership for countless drivers. Curious how your state stacks up amid these climbing numbers? Read on.
Crunching the Numbers: Auto Financing at a Glance
| Average New Car Monthly Payment | $749 | Q2 Experian Data |
| Average Loan Term – New Cars | 68.87 months | Experian |
| Average Loan Term – Used Cars | 67.24 months | Experian |
| Average Interest Rate – New Cars | 6.80% | Experian |
| Average Interest Rate – Used Cars | 11.54% | Experian |
| Average Down Payment for Used Vehicles | $4,078 | Industry Reports |
| Total Auto Loan Debt Nationwide | $1.63 trillion | Industry Reports |
| Average Car Loan Balance (US) | $5,680 | Federal Reserve |
Top 10 States Carrying the Heaviest Auto Loan Burdens
| Texas | $7,920 |
| Louisiana | $6,890 |
| New Mexico | $6,780 |
| North Dakota | $6,630 |
| Florida | $6,560 |
| Georgia | $6,530 |
| Mississippi | $6,470 |
| Arkansas | $6,330 |
| West Virginia | $6,320 |
| Oklahoma | $6,270 |
Vehicle prices may have somewhat steadied but remain well above pre-pandemic heights, notes Satyan Merchant, TransUnion’s senior VP overseeing automotive and mortgage sectors.
“Continued affordability woes plague used car buyers, especially those with subprime credit standings. These folks are navigating an environment of elevated rates, lenders tightening purse strings, plus cross-sector inflation bites. Although some manufacturers still battle inventory shortages, new car stocks are bouncing back from pandemic lows.”
What Lies Ahead in Auto Pricing and Financing
The gap between new and used car prices narrows, with used rides crossing the $30,000 threshold in early 2025. Average financing durations hover just shy of six years for both new and pre-owned vehicles, painting a tale of extended borrowing horizons to secure wheels.
State-by-State Snapshots: Average Auto Payments & Interest Rates
| Hawaii | 12.55% | $729 |
| Mississippi | 12.89% | $775 |
| Louisiana | 12.42% | $806 |
| Georgia | 12.39% | $808 |
| New Mexico | 12.86% | $798 |
| Nevada | 11.95% | $775 |
| West Virginia | 11.55% | $743 |
| Alaska | 10.07% | $861 |
| Texas | 11.78% | $776 |
| South Carolina | 12.17% | $782 |
Note: Figures assume a 60-month loan term and do not factor in down payments, which tend to lighten monthly burdens.
Loan durations commonly stretch from two to six years; longer terms make monthly bills easier to swallow but often mean more overall interest paid.
Your interest rate hinges on a mix of your credit profile, vehicle specifics, and financing terms. Recent data from Q2 2025 shows new cars averaging 6.8% interest, with used cars bearing heftier costs near 11.5%.
Where Used Car Prices Run Highest
| Wyoming | $41,405 |
| Alaska | $40,462 |
| Montana | $38,943 |
| North Dakota | $37,773 |
| South Dakota | $37,192 |
| Idaho | $37,092 |
| Arkansas | $36,343 |
| Washington | $36,119 |
| Georgia | $36,016 |
| Louisiana | $35,893 |
Across the board, SUVs dominate the market, claiming roughly 63% of financed vehicle purchases in Q2 2025, per Experian’s insights.
Auto Loan Delinquency: States with Troubling Rates
| Texas | 7.92% |
| Florida | 6.54% |
| Nevada | 6.39% |
| Arizona | 6.23% |
| California | 5.42% |
| Ohio | 5.11% |
| Pennsylvania | 4.93% |
| New Jersey | 4.91% |
| Illinois | 4.81% |
| Michigan | 4.77% |
Texas doesn’t just top the charts with the heftiest loan balances—it also leads in loan delinquency, at nearly 8%. Florida trails behind but still faces a concerning 6.5%, more than a percentage point lower than Texas.
States Sporting the Lightest Auto Loan Loads
| Hawaii | $4,090 |
| Oregon | $4,270 |
| Massachusetts | $4,290 |
| New York | $4,460 |
| Connecticut | $4,520 |
Topping the list for the lowest car loan amounts, Hawaii grabs the distinction, with Oregon hot on its heels. These figures are notably beneath the national average of $5,680. Yet, as we’ve seen, these balances owe more to residents’ economic situations than zip codes.
Factors like financial know-how, income brackets, and living costs weigh heavily. Indeed, among states with the leanest loan balances, most boast some of the nation’s highest median household incomes, underscoring the link between economic muscle and borrowing habits.
Final Thoughts: Navigating Your Auto Loan Journey
No matter where you hang your hat, options abound to secure funding—even for those without established credit histories. Armed with an understanding of your state’s landscape and the dynamics at play, you can better strategize to lock down favorable financing that matches your financial picture.
