PenFed auto loans: 2025 review

Types of car loans that PenFed offers 

New/used car loans

PenFed offers members some of the most competitive rates in the auto loan market with an online prequalification process to avoid harming your credit. Its lowest rates are reserved for borrowers who use its new car-buying service through TrueCar. However, the lender offers terms as long as 84 months to help keep your payment low on expensive vehicle purchases. 

Refinance loans

If you have a car with less than 125,000 miles you may be able to refinance it with PenFed. Its auto refinance rates are slightly higher than its new and used car purchase options. Still, the longer terms may be worth considering if you’re having difficulty making payments on a current short-term loan. 

Where PenFed stands out

• Very low minimum APRs. PenFed’s new car buying service rates are among the lowest of Bankrate-reviewed auto lenders. 
• Up to 125 percent financing. You can finance extras like gap insurance or extended warranties with PenFed’s 125 percent financing option. 
• Flexible loan terms. With the costs of new cars continuing to head higher, PenFed’s long loan terms give you lower payment choices to keep your payment affordable. 

Where PenFed falls short

• Must be a PenFed member to qualify. Only PenFed members qualify for its auto loan products. You must be an American citizen or permanent resident alien to qualify. 
• No published credit requirements. The lender’s website doesn’t provide any information about credit score, income or debt minimums to qualify.
• Must open a PenFed savings account with a minimum balance. You must open a savings account with a minimum balance of $5 to be eligible for a PenFed auto loan. 

PenFed customer resources 

Customer support

PenFed borrowers can schedule a call with a representative using its online form 24/7, but its regular customer service phone hours are Monday through Saturday from 8 a.m. to 8 p.m. ET. Phone contact is not available on Sundays. 

Digital experience

You can prequalify online without affecting your credit, and the entire loan process can be completed digitally. The lender also provides a loan calculator if you want to crunch numbers with different down payments, loan terms or trade-in values (if you’re upgrading your current car). 

How this lender compares

Do you qualify for a PenFed auto loan?

In general, you just need to verify your citizenship or permanent residency status and qualify based on your income, credit score, and the type of vehicle you’re buying or refinancing. New car purchase or refinance loans require that your vehicle be no more than a year old. Older used vehicles may come with higher rates and the lender won’t finance any vehicle with more than 125,000 miles on it. 

How Bankrate rates PenFed

The Bankrate team uses a 16-point system to evaluate auto loan refinance products across four main categories.