New vs Used Car Financing: APR Differences, Depreciation & Loan Rules
Compare financing a new vehicle versus a used vehicle: interest rate differentials, rapid year-one depreciation, and loan term limits.
By Sarah Jenkins, CFA
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Reviewed by David Vance, CFP
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5 min read
New vs Used Vehicle Financing Matrix
| Factor | New Vehicle Financing | Used Vehicle Financing |
|---|---|---|
| Average Interest Rate (APR) | Lower APR (5.5% – 7.5%) | Higher APR (8.0% – 12.5%) |
| Year 1 Vehicle Depreciation | Steep 15% – 25% drop | Slower, flatter depreciation curve |
| Promotional Subsidized APRs | Available (0% – 1.9% dealer incentives) | Rarely available |