Wednesday, September 5, 2012

More car loans are going to subprime borrowers

"Subprime borrowers received 56.46 percent of loans on used cars in the quarter, up from 52.70 percent a year earlier."

This fact in itself isn't too surprising since car loans are among some of the easiest loans to get. The 'no credit, no problem' mantras are always present at used car lots (especially the independent ones). Remember that car dealers have several ways to make money off an unsuspecting customer - unfavorable financing terms are one of the big ones.  Don't forget to watch out for the lowball trade-in values or phantom fees.

Some other interesting stats on car loans:

"The average amount financed for a new car rose $474 to $25,714. For a used car, the average amount financed rose $370 to $17,433."

"The average time to repay new and used car loans increased by one month, to 64 months for new cars and to 60 months for used cars."

Read the full article at the Chicago Tribune.

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