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Auto loan terms continue to loosen for all buyers

The Boston Globe -- For car buyers seeking auto loans, happy days are here again. Banks and auto finance companies are once again welcoming all kinds of customers, even those with less-than-stellar credit.

Low interest rates are making it cheaper for banks to get money, which makes them more willing to lend. The federal funds rate — the rate at which banks lend to each other — is near zero percent, down from 2 percent in summer 2008.

Loans to subprime buyers — buyers with credit scores of 679 or lower — are particularly attractive, since banks can charge higher interest rates. The average interest rate for a deep subprime loan, to someone with a credit score below 550, is 12.9 percent for a new car, compared with 3.2 percent for buyers with the highest scores, according to Experian Automotive.

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Submitted Jul 20, 2012 By: angel4me

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honda0105 Champion Author Tallahassee Posts:18,828 Points:1,637,220 Joined:Nov 2008	Message Posted: Jul 23, 2012 5:52:50 AM Ignore honda0105 Report Abuse gonna be another bubble, just like housing. Esp. if another Cash 4 Clunkers is coming down the pipe.
Soglaos Champion Author Virginia Beach Posts:2,851 Points:765,405 Joined:Feb 2011	Message Posted: Jul 21, 2012 10:51:13 PM Ignore Soglaos Report Abuse I understand why
Wizrd03 Champion Author Illinois Posts:8,293 Points:1,660,035 Joined:Oct 2008	Message Posted: Jul 21, 2012 9:20:18 AM Ignore Wizrd03 Report Abuse Old news
1WI All-Star Author Appleton Posts:818 Points:274,255 Joined:Jan 2012	Message Posted: Jul 21, 2012 2:30:58 AM Ignore 1WI Report Abuse No one wants to lose their wheels.
Dodge_Me Champion Author Atlanta Posts:2,214 Points:576,480 Joined:Mar 2006	Message Posted: Jul 21, 2012 12:09:59 AM Ignore Dodge_Me Report Abuse Now if only the housing market would step up also
jrschl Champion Author Louisville Posts:3,107 Points:708,765 Joined:Jun 2011	Message Posted: Jul 21, 2012 12:06:00 AM Ignore jrschl Report Abuse I suppose this can relate to gas prices.
JamesCalvin Champion Author Lancaster Posts:3,344 Points:547,255 Joined:Nov 2011	Message Posted: Jul 21, 2012 12:04:37 AM Ignore JamesCalvin Report Abuse Who has money to loan???? OH... I forgot>>>> They jus printed a new batch of bills!
Ethan777OH Veteran Author Ohio Posts:270 Points:25,720 Joined:May 2011	Message Posted: Jul 21, 2012 12:01:11 AM Ignore Ethan777OH Report Abuse cool
mrbee Champion Author Little Rock Posts:3,894 Points:2,493,530 Joined:Oct 2005	Message Posted: Jul 21, 2012 12:00:45 AM Ignore mrbee Report Abuse But will they have to be bailed out again?
NedW Champion Author Indianapolis Posts:5,750 Points:1,167,995 Joined:Mar 2008	Message Posted: Jul 20, 2012 11:57:56 PM Ignore NedW Report Abuse Cool! I wonder if I can get a Corvette ZR1 now? Oh. I forgot...Government Motors.
bra0712 Champion Author Arizona Posts:3,795 Points:795,800 Joined:Nov 2008	Message Posted: Jul 20, 2012 11:57:45 PM Ignore bra0712 Report Abuse K
Ethan777OH Veteran Author Ohio Posts:270 Points:25,720 Joined:May 2011	Message Posted: Jul 20, 2012 11:56:20 PM Ignore Ethan777OH Report Abuse yeah..sure...seeing tons of people with bad credit getting approved...yep,yep...
Vitobug Champion Author El Paso Posts:1,979 Points:663,190 Joined:May 2011	Message Posted: Jul 20, 2012 11:55:00 PM Ignore Vitobug Report Abuse ok
fenster66 Champion Author Pittsburgh Posts:3,490 Points:701,790 Joined:May 2011	Message Posted: Jul 20, 2012 11:52:02 PM Ignore fenster66 Report Abuse seems like deja vu....
suzmar Champion Author Texas Posts:2,223 Points:896,935 Joined:Jun 2006	Message Posted: Jul 20, 2012 11:51:28 PM Ignore suzmar Report Abuse Okay, isn't this how banks got in trouble with mortgages and student loans?
Marson Champion Author Scranton Posts:9,082 Points:2,104,885 Joined:Oct 2006	Message Posted: Jul 20, 2012 11:49:01 PM Ignore Marson Report Abuse Better keep your score up!
JENNYHK Champion Author Chicago Posts:3,781 Points:740,295 Joined:Apr 2011	Message Posted: Jul 20, 2012 11:45:55 PM Ignore JENNYHK Report Abuse ok.
RAKARWOWSKI Champion Author Chicago Posts:4,140 Points:848,725 Joined:Jan 2011	Message Posted: Jul 20, 2012 11:43:44 PM Ignore RAKARWOWSKI Report Abuse ok.
abcdMA Champion Author Worcester Posts:8,052 Points:1,600,730 Joined:Nov 2008	Message Posted: Jul 20, 2012 11:42:22 PM Ignore abcdMA Report Abuse will we ever learn?
drz614 Champion Author Harrisburg Posts:2,441 Points:626,085 Joined:Aug 2011	Message Posted: Jul 20, 2012 11:36:34 PM Ignore drz614 Report Abuse ok
mstearno Champion Author Dayton Posts:8,174 Points:1,755,920 Joined:Jan 2008	Message Posted: Jul 20, 2012 11:34:25 PM Ignore mstearno Report Abuse great next recession will prove hurtful
slayur Champion Author Chicago Posts:1,534 Points:1,238,990 Joined:Sep 2005	Message Posted: Jul 20, 2012 11:32:35 PM Ignore slayur Report Abuse lol
sillywagon Champion Author New York Posts:15,121 Points:1,469,045 Joined:Oct 2008	Message Posted: Jul 20, 2012 11:32:23 PM Ignore sillywagon Report Abuse Sub-prime auto loans? This is not good.
DarthDadJr Champion Author Virginia Posts:7,432 Points:1,546,645 Joined:Jul 2008	Message Posted: Jul 20, 2012 11:28:55 PM Ignore DarthDadJr Report Abuse I hope they stay low for one more year...need to get a new van for the wife next year.
N5EXY Champion Author Austin Posts:5,634 Points:1,537,780 Joined:Jul 2004	Message Posted: Jul 20, 2012 11:28:36 PM Ignore N5EXY Report Abuse This could be worse than the housing loan fiasco. Real estate usually appreciates. Motor vehicles always depreciate rapidly as soon as they are titled and driven away from the dealership. Result, big debt with no equity.
a_lu_vasile Champion Author Maryland Posts:1,254 Points:791,650 Joined:Jul 2008	Message Posted: Jul 20, 2012 11:23:48 PM Ignore a_lu_vasile Report Abuse ok
REKEY Champion Author South Carolina Posts:8,723 Points:1,727,095 Joined:May 2008	Message Posted: Jul 20, 2012 11:23:12 PM Ignore REKEY Report Abuse Still can't afford one!
hauler43 Champion Author Oakland Posts:8,158 Points:2,597,750 Joined:Sep 2003	Message Posted: Jul 20, 2012 11:22:47 PM Ignore hauler43 Report Abuse OK
clermont40miles Champion Author Cincinnati Posts:10,754 Points:1,800,345 Joined:Apr 2008	Message Posted: Jul 20, 2012 11:19:06 PM Ignore clermont40miles Report Abuse Not a good time to go deep into debt. Debtor is slave to the lender. Stay free.
96sc1 Champion Author El Paso Posts:8,517 Points:1,367,440 Joined:Mar 2008	Message Posted: Jul 20, 2012 11:18:58 PM Ignore 96sc1 Report Abuse Loan terms are already way to loose.
walkingtall Champion Author Toronto Posts:4,138 Points:1,149,360 Joined:Nov 2004	Message Posted: Jul 20, 2012 11:16:30 PM Ignore walkingtall Report Abuse Auto loan terms continue to loosen for all buyers and the happy days are here again if you can afford to pay the amount on time.
Blue48 Champion Author Illinois Posts:7,445 Points:1,665,645 Joined:Feb 2007	Message Posted: Jul 20, 2012 11:15:54 PM Ignore Blue48 Report Abuse WHATEVER!
esq262 Champion Author Asheville Posts:2,998 Points:674,540 Joined:Jul 2011	Message Posted: Jul 20, 2012 11:13:13 PM Ignore esq262 Report Abuse Pay cash.
Tekkersmom57 Champion Author Syracuse Posts:2,019 Points:728,890 Joined:May 2010	Message Posted: Jul 20, 2012 11:11:30 PM Ignore Tekkersmom57 Report Abuse Happy days are here again if you can afford to pay the amount on time.
skybiker Champion Author South Carolina Posts:7,408 Points:1,586,615 Joined:Jul 2008	Message Posted: Jul 20, 2012 11:09:32 PM Ignore skybiker Report Abuse Insurance prices are still too high....
Lukus Champion Author Halifax Posts:8,419 Points:1,701,255 Joined:Nov 2007	Message Posted: Jul 20, 2012 11:08:34 PM Ignore Lukus Report Abuse They want to suck you in and then claim the vehicle back.
aggietim Champion Author Fort Worth Posts:1,831 Points:717,200 Joined:Oct 2008	Message Posted: Jul 20, 2012 11:07:25 PM Ignore aggietim Report Abuse good
MahopacJack Champion Author New York Posts:8,081 Points:1,605,310 Joined:Feb 2008	Message Posted: Jul 20, 2012 11:04:10 PM Ignore MahopacJack Report Abuse Should prove somewhat helpful but a rosier job outlook would be better.
AnObserver Champion Author New Jersey Posts:8,494 Points:2,285,480 Joined:Sep 2005	Message Posted: Jul 20, 2012 10:58:06 PM Ignore AnObserver Report Abuse With interest rates at all time lows and the auto industry pushing to recover, the good deals are understandable
jad1960 Champion Author Gary Posts:1,575 Points:423,780 Joined:Feb 2012	Message Posted: Jul 20, 2012 10:57:07 PM Ignore jad1960 Report Abuse Whatever
vulcan96 Champion Author Ohio Posts:27,145 Points:3,126,955 Joined:Aug 2004	Message Posted: Jul 20, 2012 10:57:03 PM Ignore vulcan96 Report Abuse go for it - get a 40+ mpg car
knot2swift Champion Author Calgary Posts:4,511 Points:718,710 Joined:Nov 2009	Message Posted: Jul 20, 2012 10:52:40 PM Ignore knot2swift Report Abuse I got screwed so bad with my Toyota Carolla. Back in the days before the Depression, I could only get 0% for 36 months. Nothing like paying off a car in 3 years! $685.15 a month is hard to take even if it is interest free. 3 more idiot payments! Then I'll have a lot of money to waste on the house. The stupid thing in my driveway is such a pain! Come October, NO MORE PAYMENTS ON THE DECOUR IN MY DRIVEWAY! [Edited by: knot2swift at 7/20/2012 10:55:36 PM EST]
dong1971 All-Star Author Vancouver Posts:660 Points:234,390 Joined:May 2012	Message Posted: Jul 20, 2012 10:50:59 PM Ignore dong1971 Report Abuse I don't care.
allstar3 Sophomore Author Baton Rouge Posts:136 Points:76,800 Joined:Dec 2011	Message Posted: Jul 20, 2012 10:50:19 PM Ignore allstar3 Report Abuse Won't be long for the next bailout.
MadTraveler Champion Author Idaho Posts:2,082 Points:572,100 Joined:Nov 2009	Message Posted: Jul 20, 2012 10:49:53 PM Ignore MadTraveler Report Abuse Nice.
Spankster85 Champion Author Chicago Posts:1,859 Points:384,315 Joined:Nov 2011	Message Posted: Jul 20, 2012 10:49:02 PM Ignore Spankster85 Report Abuse 12.9 percent...kinda rough.
rcornel All-Star Author San Diego Posts:804 Points:250,495 Joined:Jun 2012	Message Posted: Jul 20, 2012 10:47:09 PM Ignore rcornel Report Abuse Wow... Ok!?!
bvrbill Champion Author Eugene Posts:3,440 Points:546,000 Joined:Jul 2011	Message Posted: Jul 20, 2012 10:46:44 PM Ignore bvrbill Report Abuse We'll be seeing more loan defaults.
papa56NC All-Star Author North Carolina Posts:725 Points:142,760 Joined:Apr 2012	Message Posted: Jul 20, 2012 10:45:32 PM Ignore papa56NC Report Abuse Git-ur-dun then
judgemobile Champion Author Ohio Posts:7,705 Points:2,472,635 Joined:Nov 2005	Message Posted: Jul 20, 2012 10:43:49 PM Ignore judgemobile Report Abuse when interest rates go NEGATIVE, and they pay me money to borrow, then the economy has tanked. Are you listening Geithner and Bernanke ? QE to infinity.