Analysts say Q2 set new records for average monthly payments, amount financed, and 84-month+ loans, underscoring ongoing affordability challenges for car shoppers
Santa Monica, Calif., July 01, 2025 (GLOBE NEWSWIRE) — New-car financing trends hit fresh record highs in Q2 2025, as shoppers stretched their budgets to manage ongoing affordability challenges, according to the latest analysis from Edmunds. Here’s a breakdown of key findings from Edmunds’ Q2 2025 data on financed new-car purchases:
- $1,000+ monthly payments are reaching new highs: The share of these new-car buyers committing to monthly payments of $1,000 or more hit an all-time high of 19.3% in Q2 2025, compared to 17.7% in Q1 2025 and 17.8% in Q2 2024.
- More buyers are opting for extended loan terms than ever before: Edmunds analysts report that 84-month+ loans set a new record in Q2 2025, accounting for 22.4% of new-vehicle financing — up from 20.4% in Q1 2025 and 17.6% a year ago.
- Bigger loans are becoming the new normal: The average amount financed for new-vehicles climbed to $42,388 in Q2 2025, an all-time high, up from $41,473 in Q1 2025 and $40,873 in Q2 2024.
- Shoppers are putting less money down: The average down payment for new-car purchases was $6,433 in Q2 2025, down from $6,511 in Q1 2025 and $6,579 in Q2 2024.
- 0% finance deals sink below 1% for the first time ever. In Q2 2025, 0% finance deals accounted for 0.9% of new-vehicle loans — the lowest share Edmunds has on record since 2004 and down from 1% in Q1 2025 and 2.9% in Q2 2024.
- Interest rates remain historically high. The average new-vehicle annual percentage rate (APR) in Q2 2025 was 7.2%, compared to 7.1% in Q1 2025 and 7.3% in Q2 2024.
“It would be easy to assume that tariffs are already reshaping the market, but the reality is that the record-breaking trends we saw in the second quarter are reflective of more consumers opting for maxed-out term lengths despite vehicle prices remaining steady,” said Ivan Drury, Edmunds’ director of insights. “It’s clear that buyers are pulling the few levers they can control to manage affordability, whether that’s by taking on longer loans, financing more, or putting less money down — even if some of those decisions increase their total costs. Consumers are continuously stretching to afford new vehicles in this market, and while tariffs haven’t directly driven these Q2 numbers, they’re certainly not going to make things any easier for shoppers moving forward.”
As more buyers lean on extended loan terms, Edmunds analysts caution that this strategy could carry consequences down the road.
“While extended loan terms may make a monthly payment more palatable, consumers need to keep in mind the risks associated with a loan extended that far into the future, including increased costs for upkeep down the line and the risk of being underwater on the loan if the car is traded in before it’s paid off,” said Joseph Yoon, Edmunds’ consumer insights analyst. “If payments on a more standard 60- or 72-month loan don’t fit your budget, you might consider leasing. While you won’t be building equity in your vehicle the way you do with a purchase, leases afford time to get your finances in better shape with lower monthly payments in the meantime.”
Quarterly New-Car Finance Data
(Averages)
| 2025 Q2 | 2024 Q2 | 2025 Q1 | |
| Term | 69.8 | 69 | 69.5 |
| Monthly Payment | $756 | $740 | $741 |
| Amount Financed | $42,388 | $40,873 | $41,473 |
| APR | 7.2 | 7.3 | 7.1 |
| Down Payment | $6,433 | $6,579 | $6,511 |
Quarterly Used-Car Finance Data
(Averages)
| 2025 Q2 | 2024 Q2 | 2025 Q1 | |
| Term | 69.7 | 69.7 | 69.7 |
| Monthly Payment | $559 | $552 | $550 |
| Amount Financed | $29,080 | $28,166 | $28,338 |
| APR | 10.9 | 11.5 | 11.3 |
| Down Payment | $4,092 | $4,140 | $4,078 |
About Edmunds
Edmunds guides car shoppers online from research to purchase. With in-depth reviews of every new vehicle, shopping tips from an in-house team of experts, plus a wealth of consumer and automotive market insights, Edmunds helps millions of shoppers each month select, price and buy a car with confidence. Regarded as one of America’s best workplaces by Newsweek, Fortune, Great Place to Work and Built In, Edmunds is based in Santa Monica, California. Follow us on TikTok, Twitter, Facebook and Instagram.
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CONTACT: Talia James-Armand Edmunds 310-491-8738 pr@edmunds.com
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