Geographical location is not a major factor affecting the delinquent interest rate, interest rate, and payments on average car loans. Rather, they are determined by the driver’s credit score and history, income, liability, loan amount and duration. However, by breaking down these statistics by location, you can get a peek at the economic situation in each state.
Over the past year, drivers have had to rent more for their cars. These higher car loan balances, combined with steep interest rates, make vehicle ownership a challenge for many. Find out what your home state is like as your interest rates and loan balances increase.
Car payment statistics
State with the highest auto loan balance
The car loan balance is the remaining amount that a driver must pay for the loan. According to the Federal Reserve, the amount of drivers spending on vehicles has been on an upward trend nationwide at $1.63 trillion since 2020.
According to the Federal Reserve, the national average car loan balance is $5,680. Below are the 10 states with the highest auto loan balance in the country.
| state | Average car loan balance |
|---|---|
| Texas | $7,920 |
| Louisiana | $6,890 |
| New Mexico | $6,780 |
| North Dakota | $6,630 |
| Florida | $6,560 |
| Georgia | $6,530 |
| Mississippi | $6,470 |
| Arkansa | $6,330 |
| West Virginia | $6,320 |
| Oklahora | $6,270 |
Vehicle costs are levelled, but they are not yet at pre-pandemic levels, explains Satyan Merchant, Senior Vice President at Transunion and Automotive and Mortgage Business Leader.
“Affordable prices continue to pose challenges for the second-hand car market, particularly for the major consumers who have seen the higher interest rate buying environment.
Additionally, drivers are opting for longer loan terms to reduce monthly costs of car payments. The average vehicle usage conditions for the fourth quarter of 2024 reached 67.20 months. The new vehicle conditions spoke similarly, with drivers raising funds for an average of 67.98 months.
Average car payments by state
| state | Average Used Car APR | Average monthly payment |
|---|---|---|
| Hawaii | 12.55% | $729 |
| Mississippi | 12.89% | $775 |
| Louisiana | 12.42% | $806 |
| Georgia | 12.39% | $808 |
| New Mexico | 12.86% | $798 |
| Nevada | 11.95% | $775 |
| West Virginia | 11.55% | $743 |
| under | 10.07% | $861 |
| Texas | 11.78% | $776 |
| South Carolina | 12.17% | $782 |
Source: ISEECARS and EDMUNDS
The average monthly payment figures for each state were calculated using a combination of average used car prices, interest rates for each state, and a 60-month loan period. However, they did not consider down payments that cut monthly payments.
The terms of the loan are typically between 24 and 84 months. Some lenders offer 96 months terminology. In the long run, monthly costs will be lower, but overall costs will be higher.
The interest rate you pay for a vehicle depends on a variety of factors, including credit, vehicle type, and selection criteria. According to Experian’s fourth quarter 2024 data, drivers can expect to pay around 6.35% for new cars and 11.62% for used cars.
Average used car prices by state
| state | Average used car prices |
|---|---|
| Wyoming | $41,405 |
| under | $40,462 |
| Montana | $38,943 |
| North Dakota | $37,773 |
| South Dakota | $37,192 |
| Idaho | $37,092 |
| Arkansa | $36,343 |
| Washington | $36,119 |
| Georgia | $36,016 |
| Louisiana | $35,893 |
According to Experian, the SUV remains the most popular new vehicle type, earning a total of around 64% of vehicles loaned in the first quarter of 2025.
Delinquent car loans by state
| state | Average delinquency rate |
|---|---|
| Texas | 7.92% |
| Florida | 6.54% |
| Nevada | 6.39% |
| Arizona | 6.23% |
| California | 5.42% |
| Ohio | 5.11% |
| Pennsylvania | 4.93% |
| New Jersey | 4.91% |
| Illinois | 4.81% |
| Michigan | 4.77% |
Source: New York Fed Consumer Credit Panel
Texas has the highest average car loan balance and the highest average late payment of 7.92%. Florida is the second highest at 6.54%, especially one point below the Texas rating.
When it comes to prioritizing payments, the key is preparation. To do this, you need to fund only what you can afford. The best way to do this is to calculate your monthly payments and lifetime profits on your loans and compare it with your budget.
State with the lowest auto loan balance
| state | Average car loan balance |
|---|---|
| Hawaii | $4,090 |
| Oregon | $4,270 |
| Massachusetts | $4,290 |
| new york | $4,460 |
| Connecticut | $4,520 |
Source: New York Fed Consumer Credit Panel
Hawaii wins gold medals with the lowest average car loan balance, followed by Oregon. These states have a state that is significantly lower than the national average of $5,680. However, as explained, the balance of car loans is unrelated to the postal code, and rather is related to the economic situation of the residents.
Financial literacy, income and cost of living all play an important role. For example, looking at the lowest balance states, according to the Census Bureau, three out of five hold some of the highest household income in the country. These states also tend to have a higher average credit score.
According to Experian, Hawaii’s average FICO score is 732, which falls in a good category. This is higher than the national average credit score of 715. The remaining states are similarly equipped with a high average.
Conclusion
No matter what state you call, you can ensure a competitive auto loan rate by improving your credit score and working to shop with some lenders. There are factors out of control, such as the price of the vehicle and the current rate, but the better your credit score, the more likely you are to see your rates go up.
If you’re struggling to find monthly payments you can afford, consider shopping for a bad credit car loan that deals with people who have little or no credit.
