Average New Car Payment In US Hits $745 Per Month, Says Study

To paraphrase noted New York politician and owner of incredible facial hair James McMillan III, the car payments are too damned high. The average new car payment in 2025 has hit $745, with the average loan length inching closer and closer to 72 months.

Even with those longer terms, buyers are struggling. Consumer credit reporting company Experian’s state of the (automotive financing) union says more buyers are falling behind, with nearly 1% of those with loans on new cars and 1.5% of used cars 60 days behind on their payments.

Average New Car Payment Up 35% In Six Years

At the end of 2019, the average payment for a newly financed vehicle was $554. If you were leasing, the average payment was $455, with a lease term of just over 36 months and a loan term of 68 months. According to the latest Experian State of the Automotive Finance Market report, the terms are largely the same but the amounts are way up. We’re talking $745 for a loan and $595 for a lease, so yeah. Buyers are paying considerably more for their vehicles than ever before. With higher sticker prices and high interest rates, that’s probably not much of a surprise.

With new prices come new trends. For example, the average age of a financed vehicle is dropping, from 4.24 years in 2023 to 3.83 years now. This is likely related to the increased number of leases, with 24.7% of buyers leasing their new vehicle now versus 19% in 2023.

Buyers struggling with their finances are increasingly stuck with their old ride. Experian data shows that just 14% of new loans and leases (of both new and used vehicles) went to customers with subprime credit scores, and 2.1% to those in deep subprime territory. In 2020, those figures were 17.7% and 4.35%.

EV Customers Love Their Leases

Higher prices are likely driving shoppers to leases, but EVs are helping too. Only 31% of new EVs were financed, while 59.3% were leased. In 2023, just 11.5% were leased, with 59% financed. It’s partly thanks to incredible lease deals that simply aren’t available on finance, plus the EV tax credit that isn’t available on all purchases but is on most leases. However, the pattern varies significantly with the specific vehicle. For example, only 26% of Tesla Cybertrucks were leased versus 90% of Honda Prologues. The Ford F-150 Lightning was the most evenly split, with 49.7% financed and 45% leased.

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Honda as a whole is the most leased new vehicle brand, with 11.49% of its customers opting to go that route. Toyota and Tesla are close behind, while GMC and Cadillac both had well under 2% of customers choosing to lease, the lowest among the brands in the study.

Big-Ticket Buyers Finance

When the payments get really high, the study shows buyers are more likely to finance. Taking into account payments of more than $1,000 per month, 17% were for financed loans compared to 8% for leasing. On the flip side, 26.5% of lease payments were under $400, while a third of loans were between $500 and $700 per month.

Buyers already in long-term contracts are seeing the biggest impact of loan terms getting longer. Experian data says 85-month and longer loans grew from 2.2% to 2.9% since 2023. Meanwhile, the percentage of buyers under 60 months is essentially unchanged. That means it’s the 60-month to 84-month buyers who are extending, an indication that this group is really struggling to afford the same car they had just a few years ago.

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What does all this mean? Simply put: new cars and trucks are very quickly becoming as expensive as rent. The average payment for a new Ford F-150, the most popular vehicle in the US, is now a staggering $913 a month. It’s not quite enough to get you a mortgage, but it is shockingly close in at least a handful of states.

Source: Experian