Subprime auto loans increase in second quarter of 2012
Posted on Wednesday, September 5, 2012 at 3:44:32 PM
According to reports from Experian Automotive, an informational services and market intelligence firm, loans to customers in the nonprime, subprime and deep-subprime risk tiers accounted for more than one in four vehicle loans during the second quarter of 2012. Consumers in one of the aforementioned categories made up 25.41 percent of all vehicle loans – this is up 14 percent compared to the second quarter of 2011.
"Despite the rise in subprime loans overall, there is still a strong sense of managing risk," said Melinda Zabritski, director of automotive credit for Experian Automotive. "Because the overall lending environment has improved, lenders are making loans available to a wider range of customers."
The increase in lending options to consumers could increase the number of auto financing applications being processed in the upcoming months. As the economy continues to improve, more credit-challenged Americans are seeing their applications for an auto loan gain approval from financers such as Home Loan Investment Back. Many consumers are seeing their financial status slowly improve in tandem with the overall economy.