Car loans for low credit scores

It’s getting easier to get a car loan, which is good news all around. Easier car loans benefit subprime borrowers at a time when more Americans than ever have low credit scores. More cars can be sold with this credit market. Auto lenders are happy with more cars being sold. Also, more cars being sold mean a recovering economy. Resource for this article – Car loans getting easier for individuals with low credit scores by Car Deal Expert.

Car loans for poor credit more available

Auto markets expand their cars when they credit market is making loans. The Associated Press reports that car buyers with low credit scores are getting a break. 60 percent of individuals under a 620 credit score could get auto loans for people with bad credit in the past. 5 percent was the going rate for the last year. It has gotten up to 9 percent though. A huge part of the market contains those with poor credit although they have to pay bigger down payments and will end up with more interest payments.

Interest rates going down for car loans

17 percent of auto loan finance were given to those with amazing credit, as outlined by the Associated Press, in 2010’s first quarter. Experian explains that 53 percent was used cars rather than new. Borrowing could increase since car loan interest rates are diving down. The average interest rate for a four-year car loan this month is 6.3 percent, down from 7.2 percent a year ago, according to Bankrate.com.

Auto makers need buyers with low credit scores

Credit scores fell for all Americans within the country. 43 million individuals are shown by FICO Inc. to have credit scores below 599. Subprime lending comes with higher default rates, which hurt the auto lending industry during the economic meltdown. But the Wall Street Journal reports that General Motors in particular is looking for methods to expand loans to riskier buyers. GM needs to reach buyers with weaker credit scores because they make up a larger portion of its customers than some of its competitors.

Lower rate auto lending doing great

To make more loans to people with low credit scores, GM made a deal with subprime auto lender AmeriCredit Corp. Under this arrangement GM augments the loans with cash incentives so it can offer more competitive rates. Americredit Corp. is one of the largest subprime auto lenders. The business expanded the number of auto dealers it works with to more than 8,000 in the first quarter of this year, up from 4,500 a year ago.

Associated Press
google.com/hostednews/ap/article/ALeqM5gCH7uRdNTEXaUCoNUPeukZZi3qDwD9H22DQ00
Bankrate.com
bankrate.com/
Wall Street Journal