Best Car Loans for First-Time Buyers

AUTOPAY wins for most when it comes to best auto loans for first-time car buyers. There are a few different reasons for this, including the variety of loans it covers, the ability to draw from multiple lenders, and a very low Annual Percentage Rate (APR). 

The benefits with AUTOPAY begin at application. Rather than going straight in with a hard credit pull, the company starts with what’s called a soft pull. This allows potential creditors to see your credit score and provide pre-qualified without affecting your credit score. If you’re not sure what types of loans for which you’d be eligible, this can help clarify your options quickly and easily. 

Thanks to its ability to work with multiple lenders, you’ll be able to choose the loan that best fits your needs. This also means that you may have better success with Autopay than with some other lenders if your credit score isn’t the best. 

Finally, AUTOPAY works across a variety of car loans. This is true whether you’re purchasing new, used, from a dealer, from a private party, or looking to buy out a lease. 

As the largest bank in the United States, Chase has the resources and the reach for all your financing needs. This is one reason why we’ve chosen the company as the best for large lenders. 

Other reasons include the ability to apply for up to $1,000,000 in financing, which is 10 times more than you’d receive with competitor AUTOPAY. If you’re in the market for an exorbitantly priced vehicle and have the means to afford such a purchase, Chase is a good option. This is also thanks to its financing terms—although they’re expensive even for those with excellent credit, you won’t pay more if you’re financing large amounts. 

If you’re an existing customer with Chase, you may also be eligible for special offers; these aren’t disclosed on its lending website. Instead, you’ll need to log in to your account to see what options are available. 

As a member-owned and not-for-profit credit union, Navy Federal offers military members and their families special rates for all types of banking. 

This is showcased especially for eligible active duty members, whose loans Navy Federal has chosen to limit to just 4%. This beats their otherwise advertised rate of 4.54%–which is available to all qualified members. Even if you’re not eligible for the 4% rate, active duty or retired veterans can still receive a 0.25% discount on auto loans with direct deposit, helping to drop the cost of monthly payments. 

That being said, the only ways to receive your funds are by check, which can either be disbursed at a local branch or mailed to you. This is a much slower alternative than a digital deposit and may be unwieldy in a fast-moving car market. 

Carvana is as simple as it gets when it comes to purchasing a car online. The entire process, including financing and delivery of your vehicle, can be completed without leaving the comfort of your home. 

In addition to this, Carvana finances just about everyone; you only need to be over 18, have no active bankruptcies, and make over $4,000 per year in order to qualify. This makes obtaining a car loan viable for most people, even with bad credit. 

However, Carvana also requires that you place a down payment with your purchase, so you’ll need to have cash on hand. And unlike many dealers, Carvana doesn’t accept credit card payments for your down payment. 

That being said, it’s still possible to get discounts on your auto loan with Carvana. Setting up autopay can reduce both your monthly payment and your APR. 

CarMax bills itself as the haggle-free used-car dealer. Its strategy works—with 243 locations across the United States, there are thousands of cars from which to choose. 

CarMax offers its own financing, but also provides buyers with other lenders, including Capital One, Chase, Santander, Ally Bank, and more. This means that those with less-than-perfect credit will likely be able to find a loan option that works. 

When it comes to the best used car loans for first-time buyers, CarMax comes out ahead. This is thanks to its 30-day money-back guarantee on all its cars. As long as the vehicle is in the same condition and has been driven less than 1,500 miles, you can return it for a refund. The company also provides a 90-day/4,000 mile limited warranty on all its cars.