Capital One is a young bank, having only been in business for a little over 30 years, but it has grown into one of the country’s most popular and well-known auto lenders. It offers competitive interest rates, flexible payment options, and a range of benefits, but its loans are limited to vehicles purchased through its Auto Navigator car-buying service, which might be a turnoff for some buyers. Still, the company makes our list of the best used car auto loan providers.
Pros
- Competitive rates for most borrowers
- Capital One offers a range of flexible payment options
- The Auto Navigator tool makes car shopping easier
Cons
- Capital One’s customer service scores are lacking
- Loans can only be used at participating dealers through the Auto Navigator service
- Full loan terms not disclosed until after the application
About Capital One
Capital One is well known as a credit card provider and consumer bank, but it also offers a range of lending products, including used auto loans. While it’s significantly younger than most banks, with just over 30 years of experience under its belt, Capital One boasts millions of customers, and its online car buying tools are among the easiest to use in the business.
Company Insights
According to the Federal Reserve Board, Capital One was approved to acquire Discover Financial Services and began the process. Learn more in our news story by Brett Holzhauer.
Features and Benefits
Capital One’s lending products offer a tech-forward experience with clever features that make the process easier and more intuitive.
Auto Navigator online shopping tools
Refinancing available
Loans are only available for vehicles from participating dealers
$4,000 minimum loan amount
Down payment may be required
Capital One has minimum monthly income requirements
Capital One Reviews: Editorial Rating
Trusted Company Reviews Rating Score for Capital One: 8.3
Capital One offers competitive interest rates, and its Auto Navigator tool is one of the easier to use car buying systems around. While some parts of the process can be frustrating, such as not knowing loan terms until the end of the application, Capital One’s finance tools include auto loan calculators and others that help borrowers feel more comfortable about the process.
While the Auto Navigator tool is useful and can speed up the process, Capital One limits its auto loans to vehicles purchased through the service, which limits the buyer’s ability to shop around. Additionally, the bank requires that vehicles be no more than 10 years old and have fewer than 120,000 miles.
Loan Types | New cars, used vehicles, refinancing |
Maximum Loan Amount | Not available |
Maximum Loan to Value | Not available |
Additional Services | Discounts, 30-day rate lock |
Why We Like It
Capital One’s robust online tools make it easy to find a vehicle, see the rate, and make a purchase. Its rates are generally very competitive, and it offers service in all 50 states.
What We Don't Like
While the Auto Navigator tool is a big selling point for many buyers, Capital One only works with partnering dealers, severely limiting buyers’ vehicle choices. The bank also does not allow private sales or lease buyouts, and many buyers find their final loan terms to be different than the numbers they saw during the prequalification process.
Capital One Rates and Terms
Like all lenders, Capital One bases borrowers’ interest rates on their credit histories and other factors, making it difficult to define an “average.” The bank currently advertises a 5.36% rate for a 60-month used car loan, which is pretty standard. Terms for used auto loans range from 24 to 84 months, giving Capital One a wide range of options for borrowers. Of course, rates and terms are subject to change, so it's important to check before applying.
Additional Perks
Capital One’s Auto Navigator tool can be a big plus for people comfortable with online shopping, and the bank offers no origination or prepayment penalties. Additionally, loans for as little as $4,000 are available, making Capital One a great choice for lower-cost used cars.
Capital One Customer Reviews
Many Capital One customers complain about the bank’s speed, saying it’s often very slow to disburse funds and resolve issues. Others say the Auto Navigator tool limits their car search, while others note that not knowing the final loan terms led to surprises at the finance desk. Other buyers took issue with the bank’s advertising methods, saying they received an abnormal number of flyers and loan offers.
Who Is Capital One Best For?
Capital One is best for used car shoppers who are comfortable with an online buying experience and who don’t have very specific vehicle tastes. Its loans are limited to vehicles in the Auto Navigator tool, which reduces the number of choices.
Ally Vs Capital One Auto Loans
Ally is a Capital One competitor with a few slight differences in its operations. While Ally acts as lender for some automakers, it also partners with dealers, which may offer a wider range of vehicles than Capital One’s Auto Navigator service.
Capital One | Ally | |
Loan-to-Value | Not available | $1,000 more than book value |
Maximum Loan Terms | 84 months | 84 months |
GAP | Yes | Yes |
Used Vehicle Loans | Yes, and refinance | Yes, and refinance |
Capital One Alternatives
Capital One’s Auto Navigator makes shopping easy, but its loans are limited to participating dealers. If you’d prefer broader loan options, lower rates, or in-person banking, these alternatives are worth a look. Also, check out our overviews of the best cheap auto insurance companies and the best personal loans to help save more or discover more financing solutions.
PenFed Credit Union: Market-leading rates, long terms, and excellent customer service.
Lightstream: Flexible unsecured loans with same-day funding for well-qualified borrowers.
Bank of America: Wide branch network and refinancing with a 30-day rate lock.
Upgrade: Best for refinancing, with quick approvals and solid customer satisfaction.
Frequently Asked Questions
Conclusion
Capital One Auto Finance is a solid choice for borrowers who want a tech-forward, user-friendly car buying experience. Its Auto Navigator tool simplifies the loan process and helps users shop from participating dealerships with real-time rate previews. The lender offers competitive rates, flexible payment options, no origination or prepayment fees, and appears in our overview of the best used auto loan providers.
However, its loans are only available through a limited network of dealers, and loan terms aren’t finalized until after application. Customer service reviews are mixed, with some users citing delays and a lack of clarity. Still, for those who value convenience and transparency in the early stages of financing, Capital One remains a strong contender for used car loans and refinancing.
About Author
Chris Teague
After earning an MBA, Chris began writing about tech and finance as part of his work as a bank analyst and consultant. Wanting to pursue his first love in life, Chris jumped ship and turned his focus to the automotive industry, first as a freelance writer for Forbes, J.D. Power, The Drive, and U.S. News & World Report, before starting YourTestDriver.com and the America on the Road Radio Show. Chris brings more than ten years of experience in product reviews, in-depth analyses, and news, and has been recognized as a significant contributor in building the future of the automotive media field.