Average Car Payment in 2026: New, Used, and Lease Compared
Current averages for new, used, and leased vehicles — and why the number you see in the headlines may be misleading for your situation.
The headline numbers sound alarming: the average new car payment is now over $700/month. But averages are built from millions of different loan terms, down payments, and credit scores. Here's what's driving the numbers — and how to benchmark your own payment.
Average Car Payments in 2026
Based on Experian's Q4 2025 State of the Automotive Finance Market report:
| Vehicle Type | Average Monthly Payment | Average Loan Amount | Average Term |
|---|---|---|---|
| New car (financed) | $738/mo | $40,650 | 68 months |
| Used car (financed) | $547/mo | $26,180 | 67 months |
| New car (leased) | $558/mo | N/A | 36 months |
Why Averages Are Misleading
The average term for a new car loan is now 68 months. That's longer than most financial advisors recommend — and it artificially inflates what people can "afford" by spreading payments over a longer period. A buyer taking a 48-month loan on the same car would pay significantly more per month but far less in total interest.
The average also mixes buyers with excellent credit (rates around 5–6%) with buyers paying 12–18%. The same $35,000 loan produces a $693/month payment at 5% over 60 months — and a $781/month payment at 10%. Your rate is the single biggest lever you control.
Average Payment by Loan Term
Here's how term length changes the monthly payment on a $35,000 loan at 7% APR:
| Loan Term | Monthly Payment | Total Interest | Total Paid |
|---|---|---|---|
| 36 months | $1,082/mo | $2,952 | $37,952 |
| 48 months | $838/mo | $3,237 | $38,237 (but wait— |
| 60 months | $693/mo | $6,580 | $41,580 |
| 72 months | $596/mo | $9,912 | $44,912 |
| 84 months | $526/mo | $11,184 | $46,184 |
$35,000 loan at 7.0% APR. Use the calculator for your exact figures.
Every additional year of loan term reduces your monthly payment but adds roughly $3,000–5,000 in total interest. The "average" buyer taking a 68-month loan is paying about $7,000 more in interest than the buyer who took 48 months on the same car.
What a "Good" Payment Looks Like Relative to Income
A $738/month payment on a median household income of $80,000/year represents about 11% of gross income — before insurance, gas, and maintenance. By the 15% rule (total car costs under 15% of take-home), that leaves almost nothing for insurance and other car expenses.
A healthier benchmark: keep your loan payment under 8–10% of your monthly take-home. At $5,200 take-home (roughly $80,000 gross), that's a $415–520/month ceiling on just the loan. Most people who "afford" a $738/month payment are doing so by cutting savings or carrying other debt — not by having the income to support it.
If you want to benchmark what you should pay (not just what lenders will approve), start with the affordability guide or use the calculator to work backwards from your budget.