Buying and financing a new vehicle with an auto loan was a little bit more affordable for consumers in the third quarter.
The average total cost to buy and finance a new car decreased by $300 to $27,600, according to Comerica Bank’s Auto Affordability Index. Compared to the second quarter of this year, the total cost dropped 1.4 percent. It took 23.8 weeks of median family income to buy and finance an average-priced new vehicle during that time.
"With the recovery slowing and confidence shaky, consumers bought somewhat less expensive cars on average in the third quarter, thereby contributing to the improvement in affordability," said Dana Johnson, chief economist at Comerica Bank. "However, the cost of financing new cars rose somewhat, as buyers extended the length of their car loans by a month and increased the average size of their loans by $200."
Auto loan rates for new vehicles are still at the lowest point in years. Shoppers who are in the market for a new vehicle can also take advantage of 0 percent car loan financing, discounted leases and thousands of dollars in cash back rebates across most automakers. Zero percent auto loan rates and discounted leases require a higher credit score to qualify, but there are also lease deals and low car loan rates for shoppers who have good, but not prime, credit.