Car payments are the second-largest monthly expense for many Americans after housing. Here’s how auto loan payments vary across the country.
Average Car Payment Overview (2026)
| Metric | New Car | Used Car |
|---|---|---|
| Average monthly payment | $734 | $525 |
| Average loan amount | $40,200 | $25,800 |
| Average interest rate | 6.8% | 9.9% |
| Average loan term | 68 months | 66 months |
| Average down payment | 11% | 9% |
Average Car Payment by State
| State | New Car Payment | Used Car Payment | Average Insurance |
|---|---|---|---|
| Alabama | $705 | $510 | $175 |
| Alaska | $795 | $575 | $145 |
| Arizona | $720 | $520 | $165 |
| Arkansas | $680 | $495 | $155 |
| California | $745 | $540 | $195 |
| Colorado | $750 | $535 | $170 |
| Connecticut | $715 | $515 | $185 |
| Delaware | $700 | $505 | $170 |
| Florida | $735 | $530 | $210 |
| Georgia | $710 | $515 | $185 |
| Hawaii | $685 | $500 | $140 |
| Idaho | $695 | $505 | $140 |
| Illinois | $720 | $520 | $170 |
| Indiana | $690 | $500 | $150 |
| Iowa | $675 | $490 | $130 |
| Kansas | $685 | $500 | $145 |
| Kentucky | $680 | $495 | $165 |
| Louisiana | $710 | $515 | $220 |
| Maine | $670 | $490 | $130 |
| Maryland | $725 | $525 | $175 |
| Massachusetts | $710 | $515 | $165 |
| Michigan | $715 | $520 | $205 |
| Minnesota | $695 | $505 | $145 |
| Mississippi | $685 | $500 | $175 |
| Missouri | $690 | $500 | $160 |
| Montana | $780 | $560 | $140 |
| Nebraska | $690 | $500 | $140 |
| Nevada | $725 | $525 | $175 |
| New Hampshire | $690 | $500 | $130 |
| New Jersey | $730 | $530 | $190 |
| New Mexico | $695 | $505 | $160 |
| New York | $720 | $520 | $195 |
| North Carolina | $700 | $510 | $150 |
| North Dakota | $705 | $510 | $135 |
| Ohio | $690 | $500 | $150 |
| Oklahoma | $700 | $510 | $165 |
| Oregon | $710 | $515 | $145 |
| Pennsylvania | $705 | $510 | $160 |
| Rhode Island | $700 | $505 | $175 |
| South Carolina | $700 | $510 | $170 |
| South Dakota | $690 | $500 | $130 |
| Tennessee | $710 | $515 | $155 |
| Texas | $760 | $545 | $175 |
| Utah | $710 | $515 | $145 |
| Vermont | $680 | $495 | $130 |
| Virginia | $710 | $515 | $155 |
| Washington | $740 | $535 | $155 |
| West Virginia | $675 | $490 | $160 |
| Wisconsin | $685 | $500 | $135 |
| Wyoming | $735 | $530 | $135 |
See also:Average Cost of a Car in 2026 (New and Used)·Average Auto Loan Payment in America (2026)·Average Car Loan Interest Rates by Credit Score (2026)
States With the Highest Car Payments
| Rank | State | New Car Payment | Key Factor |
|---|---|---|---|
| 1 | Alaska | $795 | Higher vehicle prices, truck preference |
| 2 | Montana | $780 | Truck/SUV preference, rural distances |
| 3 | Texas | $760 | Truck culture, long commutes |
| 4 | Colorado | $750 | SUV/AWD preference, higher incomes |
| 5 | California | $745 | Higher vehicle prices, longer commutes |
States With the Lowest Car Payments
| Rank | State | New Car Payment | Key Factor |
|---|---|---|---|
| 1 | Maine | $670 | Lower vehicle prices, fewer luxury purchases |
| 2 | Iowa | $675 | Lower cost of living |
| 3 | West Virginia | $675 | Lower income area, more used car purchases |
| 4 | Arkansas | $680 | Lower cost of living |
| 5 | Kentucky | $680 | Lower vehicle prices |
How Much Car Can You Afford?
| Monthly Take-Home Pay | Max Recommended Payment (15%) | Max with Insurance (20%) |
|---|---|---|
| $3,000 | $450 | $600 total |
| $4,000 | $600 | $800 total |
| $5,000 | $750 | $1,000 total |
| $6,000 | $900 | $1,200 total |
| $7,500 | $1,125 | $1,500 total |
For a more detailed breakdown, see our car affordability calculator and guide on how much should I spend on a car.
Total Cost of Car Ownership by State
A car payment is just one component. Here’s the total cost of owning a car including insurance, fuel, and maintenance:
| State | Monthly Payment | Insurance | Fuel | Maintenance | Total Monthly |
|---|---|---|---|---|---|
| Texas | $760 | $175 | $180 | $100 | $1,215 |
| California | $745 | $195 | $220 | $110 | $1,270 |
| Florida | $735 | $210 | $170 | $100 | $1,215 |
| New York | $720 | $195 | $190 | $115 | $1,220 |
| Iowa | $675 | $130 | $150 | $90 | $1,045 |
Auto Loan Payment Trends
| Year | New Car Payment | Used Car Payment | Average Rate (New) |
|---|---|---|---|
| 2020 | $568 | $397 | 4.2% |
| 2021 | $585 | $420 | 3.9% |
| 2022 | $648 | $503 | 5.0% |
| 2023 | $716 | $523 | 7.0% |
| 2024 | $730 | $528 | 6.9% |
| 2025 | $733 | $526 | 6.8% |
| 2026 | $734 | $525 | 6.8% |
Car payments jumped 29% between 2020 and 2026, driven by higher vehicle prices and rising interest rates.
How to Lower Your Car Payment
| Strategy | Savings |
|---|---|
| Buy used (1-3 years old) | Save $200+/month |
| Larger down payment | Reduce loan amount significantly |
| Shorter loan term | Higher payment but less total interest |
| Improve credit score | Better rate — even 1% saves thousands |
| Refinance existing loan | Can reduce rate if credit improved |
| Consider leasing vs buying | Lower monthly but no equity |
Bottom Line
The average car payment now exceeds $700/month for new vehicles, making car affordability a growing concern. Focus on keeping total transportation costs under 15-20% of take-home pay, consider buying used, and shop around for the best auto loan rates.