Ohio Max Interest Rate on Auto Loans [UPDATED 2026]
- Mallory Edens
- Nov 12
- 5 min read
Updated: Nov 12
What is the Maximum APR Interest for Used Cars in Ohio?
[Last updated: November 12, 2025]
When considering an auto loan, it is crucial to pay attention to your interest rate. This is because your interest rate or APR (Annual percentage rate) is the amount that you pay the bank each year for your loan. It does not go towards the equity of your vehicle; it is a fee paid to the bank. For these reasons, it is in your financial best interest to avoid interest whenever possible.
Key Points
Dealer Max APR is 25%: For dealer-arranged retail installment contracts, Ohio allows an alternative finance charge up to 25% APR.
Legacy Method Exists: A fixed dollars-per-$100-per-year formula with small-balance service charges still exists, but it is used less often.
Banks May Differ: Banks and credit unions can “export” their home-state rate limits under federal law, so their ceilings may not match Ohio’s cap.
Not The 8% Rule: Ohio’s general 8% usury statute does not govern most auto loans; retail installment contracts and bank-originated loans fall under exceptions.
Contents
Maximum Interest Rate for Auto Loans in Ohio
In Ohio, the general legal interest rate is 8% per annum unless otherwise agreed upon in writing. However, for auto loans, especially those issued by banks, the maximum allowable annual percentage rate (APR) can be higher. Ohio caps dealer motor-vehicle retail installment contracts at no more than 25% APR.
Ohio Maximum Auto Loan Interest Rate: 25%
If you believe they've been charged interest rates above the legal limit, they can seek recourse through the Ohio Attorney General's office or consult with a consumer protection attorney.
Don’t Confuse The 8% Usury Rule With Auto Loans
Ohio’s 8% rule lives in a separate statute and includes multiple exceptions. Retail auto contracts and bank-originated auto loans fall under those exceptions, so the real-world cap is not 8%.
The Older Formula Still Exists
Ohio’s statute also includes a legacy method (a fixed “dollars-per-$100-per-year” finance charge with extra small-balance service charges). It is still on the books and was updated in 2025, but it is less common than using the alternative APR cap.
Why A Bank Can Show A Different Ceiling
When a bank or credit union originates your auto loan, federal law lets it follow its home-state rate rules rather than Ohio’s cap. This “rate exportation” under the National Bank Act and the FDIA is why two lenders quoting the same buyer can show different ceilings.
How To Use This As A Shopper
Treat 25% APR as the legal max on dealer paper, not a target.
Get one online preapproval to anchor your APR, then ask the dealer to beat it.
+Request a written "out-the-door" offer showing price, APR, payment schedule, and total of payments (Ohio requires clear disclosure on retail installment sales).
Best Auto Loan Rates Online
Most shoppers start by pre-qualifying online so they can walk into the dealership with a real budget and a rate to beat. Getting financing first saves time, reduces back-and-forth, and keeps the deal focused on the total out-the-door price.
Where to Check First
Credit Unions: Often the lowest APRs for strong and rebuilding credit. Many offer soft-pull pre-quals and rate discounts for autopay.
Online Lenders/Marketplaces: Quick comparisons across multiple offers with one form. Look for soft-pull pre-qualification before you consent to a hard inquiry.
Your Bank: Competitive if you have direct deposit and a clean history. Ask about relationship discounts.
Are Interest Rates Good in Ohio?
Ohio generally tracks the national market rather than running hotter or cheaper on its own. Recent nationwide data puts average new-car APRs around 6.8% in Q2 2025 and used-car APRs around 11.5%, per Experian’s State of the Automotive Finance Market; by October, Edmunds’ tracker showed roughly ~6.9% new and ~10.8% used, with Ohio sitting in the middle band on its state map. Cox Automotive’s dealer-side view, which reflects a different mix and methodology, showed ~9.1% average new-loan APR in Aug 2025, highlighting why numbers vary by source, lender type, and borrower profile. If your written offers land near these benchmarks for your credit tier — and especially if a local credit union can beat them — you’re in a good spot.
Average New Car Interest Rate in Ohio: 6.8%
How is My Interest Rate Determined?
Your interest rate can vary based on the financing terms you qualify for. Lenders will consider your debt-to-income ratio, as well as the loan term and principal. However, the most important factor is your credit, particularly your FICO score. Your FICO score is determined by several factors, the largest of which (35%) is based on your payment history. Installment payments on loans such as auto loans are one of the fastest credit-building tools. Other factors include your employment history, debt-to-income ratio, and your housing stability.
Getting Approved with Low Credit
If you would like more peace of mind when purchasing a vehicle. You can get an online auto loan with bad credit by applying to a subprime lender. Subprime lenders specialize in lending to borrowers with bad credit, and many of them offer online approval. if you need a loan quickly and have bad credit, an online lender may be your best option. Once you're approved, you'll be able to shop for a new car with confidence, knowing that you have the financing you need in place
Will Interest Rates Come Down in 2026?
Rates are expected to ease in 2026 as inflation cools and central bank policy shifts toward lower short-term rates, but the change is likely to be gradual rather than a snap back to pandemic-era lows. How much you feel it depends on lender programs, credit spreads, and automaker incentives, which can widen or narrow independently of the Fed. Well-qualified buyers will see improvement first, especially on shorter terms and new vehicles with captive financing support, while deeper subprime tiers may lag. If you are shopping now, treat any rate cuts as a bonus rather than a reason to delay, and plan to refinance after six to twelve on-time payments if your score improves and programs loosen.
TL;DR: Ohio's maximum interest rate on auto loans is 25% (APR)
Frequently Asked Questions:
What Is The Max Interest Rate On Dealer Car Loans In Ohio?
Up to 25% APR on retail installment contracts using Ohio’s alternative-rate provision.
What is the average auto loan interest rate in Ohio?
The average interest rate for auto loans in Ohio is 6.8%*
Does The 8% Ohio Usury Limit Apply To Car Loans?
Generally no. Auto financing is usually governed by Chapter 1317 or by federal bank preemption, not the 8% default
Can A Bank Legally Exceed Ohio’s Cap?
A bank/credit union may export its home-state rate limits under federal law, so state caps don’t bind it the same way.
What is Ohio's usury rate?
Ohio's general usury rate on loans is 8% unless otherwise stated in writing.
How does credit score affect your auto loan APR?
Borrowers with excellent credit (above 740) may qualify for APRs as low as 4–5%, while those with poor credit (below 600) could face rates as high as 15–20%.
Author Mallory Edens has served as a Certified Financial Advisor in Ohio for more than 30 years and is dedicated to parity and transparency in the auto industry .
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