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PenFed: 2023 Auto loan review

2023-01-01 00:00:00

At a glance

Rating: 4.1 stars out of 5

Bankrate Score

  • Availability
    Rating: 5 stars out of 5
  • Affordability
    Rating: 2.8 stars out of 5
  • Customer Experience
    Rating: 4.4 stars out of 5
  • Transparency
    Rating: 4 stars out of 5
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About PenFed

  • Moneybag

    Loan amount

    $500 to $150,000

  • Credit Good

    Min. credit score

    Not specified

  • Rates

    APR from


  • Funds available in

    Not specified

PenFed features

PenFed encourages preapproval, which can be a great way to compare its rates versus competitors, but it comes with unspecified used vehicle restrictions.


  • Checkmark

    Online vehicle buying service

  • Checkmark

    Wide range of loan amounts

  • Checkmark

    Many loan terms available


  • Close X

    Traditional underwriting criteria

  • Close X

    Several potential fees

Pentagon Federal Credit Union, more commonly known as PenFed, is a Virginia-based credit union that offers loans for new and used car loans, auto refinance loans and lease buyout loans. If you are buying a new vehicle PenFed boasts a car buying service that comes with lower rates and vehicle prices. 

While PenFed is a member-based organization, the $5 membership fee is waived for those applying for auto loans.

Do you qualify?

PenFed does not disclose lending guidelines. However, they require that you open a savings account with a minimum deposit of $5 to apply for an auto loan. The lender also reviews your debt-to-income ratio and credit score to determine if you’re a good fit for a loan. 

What we like and what we don’t like 

Between available discounts and potential fees, PenFed carries several benefits and drawbacks to consider.  

What we like

  • Online vehicle buying service. The program carries additional savings, cash incentives, loan discounts and deductibles.  
  • Wide range of loan amounts. Qualified borrowers can finance a vehicle for as little as $500 up to $150,000.  
  • Many loan terms available. New car and auto refinance loans come with terms between 36 and 84 months, while used car loans range from 36 to 72 months. 

What we don't like

  • Traditional underwriting criteria. PenFed uses credit scores as the primary measure for loan approval. 
  • Several potential fees. PenFed has a late charge of $29 and returned payment fee of $30, on top of other potential fees.  

How to contact PenFed

PenFed boasts customer service in person, over the phone or by email. Specifically, the 24/7 help center allows for questions regarding your loan application to be answered by available agents. To secure help over the phone, PenFed can be reached at 724-473-6333 or 800-247-5626. You can also use the online chat tool to get additional assistance.

Auto loan types offered 

Financing a new vehicle through PenFed requires a minimum loan amount of $500 and a max of $150,000. The same goes for a used car and both can be purchased through the car buying program offered by PenFed.

New and used auto loans

PenFed’s new and used auto loans come with competitive rates so you can keep even more of your hard-earned money in your pocket. Plus, you can get access to added protections to give you a peace of mind, including an extended warranty that covers you when your auto manufacturer’s warranty expires and debt protection if the unexpected happens and you can’t afford to make the monthly loan payments.


Whether you’re looking to get a lower interest rate, monthly payment that works better for your budget or modify the vehicle’s title, PenFed may be able to assist. According to its site, customers save $108 per month on average by refinancing. Plus, you can refinance up to 125 percent of the amount you owe, allowing you to easily access cash and use it however you see fit.

Lease buyout

If you decide you want to keep your leased vehicle, you can apply for an auto loan with PenFed. The loan amounts, terms and APRs are the same as you’ll find for standard purchase and refinance transactions.

How to apply for a loan with PenFed

The process to apply for an auto loan with PenFed is fairly straightforward and can be done online, in person at a PenFed branch or over the phone. As with any auto loan application, you can expect a hard credit pull before final approval.


How Bankrate rates PenFed

Overall score 4.1
Availability 5 PenFed offers high maximum loan amounts and a wide range of repayment terms.
Affordability 4.8 Starting APRs are higher than competitors and PenFed mainly considers traditional underwriting criteria.
Customer experience 4.4 Online access and close to 24/7 support leaves PenFed scoring high for customer service.
Transparency 4 While APRs and fees are available, the option to prequalify is not disclosed.


Bankrate considers 18 data points when rating auto loan lenders. Acceptance criteria, whether rates and fees are available and APR range all influence lender scores. These scores are broken up into four categories.

  • Availability: Loan amounts, repayment options, dealership requirements and state availability all contribute to this category.
  • Affordability: This section houses APR ranges, acceptance criteria, fees and discounts. 
  • Customer experience: How long you have to shop, customer service availability, whether there’s an app and autopay availability are accounted for in this section.
  • Transparency: This category accounts for the availability of fees and rates along with whether prequalification is available.
Editorial disclosure: All reviews are prepared by staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the lender’s website for the most current information.
Written by
Rebecca Betterton
Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ins and outs of securely borrowing money to purchase a car.

Edited by Auto loans editor