Cheapest Model Y sees APR financing interest jump to $579 monthly payment

Tesla has raised the Model Y APR again, and the year's best financing deal that started from a zero interest rate keeps shrinking. As of October 23, buyers financing a base or Premium Model Y pay 2.49% APR, up from 1.99%, while the Performance variant holds steady at 3.99%.

The climb has been steady. Tesla introduced 0% APR for 72 months on the base Model Y in December, and the AWD trim got the same deal in February 2026. After an abysmal earnings report, the zero interest deal disappeared in August and was replaced with 0.99%.

In early September the RWD, AWD, and Premium trims moved from 0.99% to 1.49%. A further 50 basis point increase to 1.99% followed just before the September 30 promo expiry. Today's change is the fifth step in under three months, and it will increase the total interest rate outlays over the course of a 60-month $45,000 loan with $3,500 compared to the beginning of the year.

Tesla did say at the Q3 earnings call that it has a large order backlog and can barely keep up with manufacturing, which is allowing it to play with the APR interest rate financing to increase its Q4 profit margins. Tesla effectively eats the interest on promotional financing, so unwinding it protects margins once the incentive has pulled sales forward.

The usual caveats apply, too. As usual, the new Model Y interest rate of 2.49% only applies to those with excellent credit of 720 or more. Moreover, buyers who miss the down payment threshold can see their effective rates closer to 3.49%. In short, if one wants the Model Y right now, waiting is unlikely to get them a better rate unless demand for Tesla vehicles drops precipitously for one reason or another.

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Daniel Zlatev - Senior Tech Writer - 2272 articles published on Notebookcheck since 2021

Wooed by tech since the industrial espionage of Apple computers and the times of pixelized Nintendos, Daniel went and opened a gaming club when personal computers and consoles were still an expensive rarity. Nowadays, fascination is not with specs and speed but rather the lifestyle that computers in our pocket, house, and car have shoehorned us in, from the infinite scroll and the privacy hazards to authenticating every bit and move of our existence.