Edmunds reports 20.3% of U.S. new vehicle buyers and 6.3% of used car buyers committed to a monthly payment of $1,000 or more in the fourth quarter, setting new records for both categories and sending average monthly payments soaring to $772 and $570, respectively.

The average amount financed for a new vehicle was $43,759, up more than $1,000 from Q4 2024. Used car buyers financed an average of $29,987, up by less than $500 year-over-year.

Average term remains high at around 70 months for all vehicles. Interest rates appear stable as well, ticking down to 6.7% from 7% for new and to 10.6% from 10.8% for used.

“Entering 2026, many of the affordability pressures that defined 2025 are still in place, including elevated new-vehicle prices and ongoing economic uncertainty,” writes Director of Insights Ivan Drury. “That said, there are early signs of rebalancing ahead. New-vehicle prices remain high but are beginning to stabilize, lower interest rates could offer some relief for both new- and used-vehicle shoppers, and an increase in off-lease returns is expected to provide more affordable alternatives in the used market.”

In December, the Federal Reserve announced its third interest rate cut of 2025, reducing its target lending rate to 3.5% to 3.75%.

Read the full report at Edmunds