Fair or bad credit typically means a higher APR and sometimes more restrictive terms — but it doesn’t mean you can’t get approved. Subprime borrowers averaged 19.42% APR on used-car loans in Q1 2026, compared to 8.77% for Prime borrowers, which adds up to real money over the loan term. Approval is still very possible, and there are concrete ways to improve the offer you’re given.
Lenders group borrowers into credit tiers, and the two lowest — Subprime (501–600) and Deep Subprime (300–500) — see the steepest jump in cost. In Q1 2026, Subprime borrowers averaged 13.44% APR on new cars and 19.42% on used, while Deep Subprime borrowers averaged 16.01% on new and 21.77% on used. On a $30,000 used-car loan over 60 months, that's the difference between roughly $7,164 in total interest at a Prime rate and roughly $17,110 at a Subprime rate — nearly $10,000 more for financing the exact same car.
Yes, though it won’t match a prime borrower’s rate. Here are a few things you can do to help:
