If you’re financing a new car, the average price is rising. In March, the average APR for new cars was 7%, which helped explain why the average monthly payment for a new car was $730. It’s too bad, but more and more people now spend more than $1,000. More than a quarter of people who bought a car in Wyoming with a loan had payments that high. Please forgive me, buyers of trucks. At least one official from Toyota says that the average new automobile price in the U.S. might reach $50,000 by year-end. Since interest rates are so high, our monthly payments must also increase if we pay more for our cars. According to Edmunds, new vehicles’ average annual percentage rate (APR) hit 7% in March. This marks the highest point since the beginning of 2008. The average pay for a new car is now $730 a month, about $80 more than a year ago. Interest rates are at or above 7 percent. Only Minnesota and South Dakota have an average APR of less than 6%, while 16 states, mainly in the South, have an average APR of more than 7%. In September, the national average was less than 6%, which has increased every month since then. For example, when we finance a car, we pay the same rate that banks pay to borrow money from the Federal Reserve. The Fed raised interest rates by more than 5% last year to keep inflation from rising too quickly. The loan term, the APR, and the price all affect the total cost and the amount a borrower pays each month—sometimes, that is a lot. According to Edmunds, more than 15% of the people who financed a new car in January paid more than $1,000 monthly. From about 10.5 percent a year ago to about 17 percent in March 2023, the percentage has increased from about 10.5 percent. Bloomberg says that because of these high costs, more Americans are expected to fall behind on their car payments in 2023 than at any other time since 2009. Wyoming has the most expensive car costs each month. Texas and Wyoming stand out as “winners” in the race to charge you at least $1000 per month for your car. Wyoming is at the top of the list because nearly 21% of people who finance new cars there make more than $100,000 annually. Cowboy State Daily says that vehicles in the state are “ridiculously more expensive” than they used to be. This is shown by a shocking 25.7% of people saying they spend more than $1,000 per month on their cars. Edmunds says the high prices in Wyoming and Texas are because “a lot of heavy trucks are bought in both states.” Even though it’s rare for used cars to have monthly payments of $1,000, Edmunds warns that financing costs are much higher than for new vehicles. In September, the average APR for borrowing money to buy a gently used car or truck was just over 9%. Last month, it was more than 11%. From the outside, it costs a lot.
