Auto Loan Rates Fell to All-Time Low in December

Consumers who bought a car in December took advantage of the lowest-ever auto loan rates, according to

Edmunds’ data found that the average car loan had an interest rate of 4.16 percent in December 2010, which is down 0.33 points from November and 0.55 points from December 2009. About 15.4 percent of all auto loans in December had 0 percent rates.

Only 4 percent of all auto loans in December had a car loan rate more than 10 percent, which says is the lowest proportion it has seen since it started gathering data in this category in 2004. also found that more car shoppers leased new vehicles in December. The number of new car sales that were leases increased to 23.6 percent, the highest monthly rate since November 2005.

One of the main reason auto loan rates were so low in December was that luxury buyers bought cars. says that since these buyers are more financially stable, they’re more willing to buy a new vehicle. The end of the year is typically a busier time for luxury auto sales. The average car loan rate for the top seven luxury brands in December was 2.9 percent, which was the lowest monthly rate in 2010.

"December brought many financially sound consumers back into the market," said Ivan Drury, analyst at "Deal-seekers are generally cautious about their spending and they likely wouldn’t enter the market unless their confidence was complemented by the right incentives."

Which brands were able to attract good-credit shoppers with their 0 percent auto loan rate incentives in December? says that Buick had the highest rate of 0 percent auto loan sales last month at more than 50 percent. Toyota had the second most 0 percent car loan sales at 40 percent in December, while Cadillac was third at about 33 percent.