How much are people paying for cars? Read and weep. Edmunds reported:
New-vehicle financing trends in Q1 2026 show car buyers continuing to take on larger loans while adjusting how they structure deals to keep monthly payments manageable, according to the latest analysis from Edmunds.
Edmunds' Q1 2026 data on financed purchases shows:
- Consumers are financing more than ever to buy new vehicles. The average amount financed for new vehicles climbed to a record high of $43,899 in Q1 2026, compared to $43,759 in Q4 2025 and $41,473 in Q1 2025.
- Monthly payments for new vehicles reached a new all-time high. The average monthly payment on financed new-vehicle purchases rose to $773 in Q1 2026, edging past $772 in Q4 2025 and up from $741 a year ago.
- $1,000+ monthly payments remain persistently high. The share of new-car buyers committing to monthly payments of $1,000 or more accounted for 20% of all financed new-vehicle purchases in Q1 2026, nearly flat from 20.3% in Q4 2025 but up from 17.7% in Q1 2025. For used vehicles, 5.3% of buyers committed to $1,000+ monthly payments, down from 6.3% in Q4 2025 but up from 4.9% a year ago.
- Buyers are putting less money down to manage upfront costs. The average down payment for new-vehicle purchases fell to $6,206 in Q1 2026 — one of the lowest first-quarter levels since 2022 — compared to $6,228 in Q4 2025 and $6,511 in Q1 2025.
- Extended loan terms reached a record high, underscoring buyers' growing reliance on longer loans to manage monthly costs. Edmunds data shows that 84-month or longer loans made up 22.9% of financed new-car purchases in Q1 2026 — an all-time high — compared to 20.8% in Q4 2025 and 21.2% in Q1 2025.
- Interest rates remained elevated for new-car shoppers. The average annual percentage rate (APR) for new-vehicle purchases was 6.9% in Q1 2026, up from 6.7% in Q4 2025 but down from 7.1% in Q1 2025. Edmunds analysts note that promotional financing remained limited: Just 2.6% of new-vehicle loans carried a 0% rate, compared to 3.1% in Q4 2025 and 1% a year ago.
"Q1 financing data shows that car buyers are getting creative just to keep their purchases within reach," said Jessica Caldwell, Edmunds' head of insights. "As loan amounts and monthly payments continue to climb to record levels, consumers are having to work harder to make the numbers fit — a clear sign of how strained affordability has become."
Ouch. Double ouch. Rest of article.
21 comments:
These figures reflect a market that is willing to pay these inflated costs. If people stopped buying new vehicles, or if they started using better financial sense when financing, the market would correct and costs would drop.
The most affordable car one can drive is the car one is currently driving.
I'm 60+ years old. I've bought I believe 8 cars and trucks, about half of them brand new, plus several tractors, ATVs, motorcycles, trailers, etc. Cumulatively I've borrowed $6,000 - for just one of those trucks - and I paid it off in 2 months.
It’s not greed but stupidity of people willing to pay this much. That’s why they chose to live paycheck to paycheck
Car you want vs. car you can afford? If paying for it over 7 yrs, buy a car w/ a cheaper total price and keep it.
I voted for lower prices.
I've never understood people who constantly get new cars. At the average car payment of $773 per month, that is $9276 per year. Folks, you can afford to repair your old car for way less than that even if it needs a major repair like a transmission replacement.
Some of the worst vehicles on the market too Ford, Chevy. Chrysler
Cash for cars, period, the end
We paid $28,500 for our first home - 3 BR 1-1/2 BA.
@ 1:30 - That's basic economic math. More advanced economics explains the concept.
Remember when Cash for Clunkers was forced upon us under the Obama Regime? It's funny what short memories the people that vote Democrat have.
It took away the affordable used market under the guise of better fuel economy (thanks Chuck Schumer), and was a boon to the manufacturers and dealers. It destroyed any buying power that people had and cleared the market of affordability.
The next time you want to complain about the cost of vehicles, you can thank Barry and Big Mike.
4:44 Your ignorance and racism is showing. Trump is to blame for all of this inflation and all you can think to do is to make unrelated insults of the former president and his very female wife.
5:24, how was that post racist? It is actually true. This all started back then and has continued. Please explain how Trump is to blame? Most tariffs have not been applied to many foreign vehicles because many are actually manufactured here, like Honda and Toyota.
Barry wanted this and his cronies pushed for the program in the name of fuel efficiency. The American people were lied to.
You probably also think that the “auto-stop” feature that engages at stop signs is saving the planet too…
It's not unlike those who have borrowed massive amounts of money to go to college. Now, they are borrowing massive amounts for a NEW car. The money is available for the right terms (aka, "what do you want your payment to be?"). And, the prices keep going up because of demand.
You mean Potato Joe’s
Inflation that the media ignored, then came back and said there’s some inflation, and then came back again and said there was full blown inflation. Your bootlicking and stupidity is showing.
The national debt increased by 30.5% ($8.45 trillion) during President Biden's four-year term. 30% in four years he should be arrested
Blame dealer financing. In the old days, financing was handled mostly by bank loans to help spread out the cost. But soon dealers got into the game and discovered consumers would pay more if they could get them to look only at a payment amount. Prices have steadily climbed as the auto industry put this new model into place.
Democrats absolutely love inflation.
5:24, the world's money supply has 3x'd since 2008 and you want to lay blame on ONE administration? You are either lacking honesty or less qualified to speak about inflation than you may think.
5:24, Thorzine is an excellent treatment for TDS.
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