subject: Financing Car Lots in Utah [print this page] Financing Car Lots in Utah Financing Car Lots in Utah
Over the last few years the average credit score of many Americans have dropped. At the same time the average credit score to qualify for car loans has risen. Prior to the recession it was common for banks and credit unions to approve car loans for people with 600 credit scores, but not now.
Currently, many banks and credit unions are declining car loan applications for people with less than a 650 credit score, and approvals now are for lowering Loan to Value amounts and shorter repayment terms.
The following before and after table will give you a better idea of what's happened to the automotive lending environment over the last few years; this is according to data obtained from select car lots within our network, which may or may not correlate to national averages.
In the competitive pre-recession car loan lending environment both lenders and people with bad credit made several bad choices. Lenders were over approving people with bad credit and people with bad credit were over extending themselves to drive an expensive newer car, so they could meet the status quo. If you have bad credit, one of the worst financial decisions you could make is to finance a car that you can't truly afford for 72 months; as most of know now a lot can happen in six years.
We Finance Car Lots and people who buy used cars from them are very practical. Unlike car loan lenders who only view the credit application and the credit report, car lots that finance people with bad credit actually meet their customers before they decide to approve their car loan, and most don't care about your credit score or the items listed on your credit report.
They ask these questions for two reasons. First, they want to protect their investment and second, after meeting you they really care about you and want to see you get back on track toward re-establishing all your finances. Compare this to the traditional used car sales for bad credit process; sell the consumer on the car, then close them on the car payment. If it's not the car dealer's money, the sales person could care a less whether or not you can actually afford the monthly payments.
Used car sales for bad credit have changed dramatically over the last few years. Lenders are no longer approving car loans for bad credit on expensive cars that will stretch the limits of someone's budget, and most car loan lenders have increased their minimum credit score requirement, lowered their Loan to Value ratios, and shortened the maximum time to pay the loan back.
For more information on auto loans in Utah, click here.
