Auto Loans Easier to Come By
March credit loosening, though, came with compromises.

Though more consumers could borrow for a new vehicle, many may be paying more.
Pexels/Sora Shimazaki
Auto credit access reached a more than two-year high in March as approval rates increased and conditions loosened among all channels.
Cox Automotive’s All-Loans Index rose 3% year-over-year to 96.4 as approval rates increased by 150 basis points.
Several metric increases, though, showed some continued vulnerabilities. Both the negative equity share of borrowers and the average down payment percentage rose 40 basis points, while the subprime share increased 220 basis points.
Meanwhile, yield spreads rose 50 basis points, indicating that lenders are mitigating taking on more risk by charging higher interest rates.
Credit access loosened year-over-year across channel and lender types, the most for noncaptive new-vehicle transactions and for credit unions.
The loosening means lenders had increased appetite for risk, and though more consumers could borrow for a new vehicle, many may be paying more, Cox pointed out in its analysis.
LEARN MORE: Helping Customers Understand Gap Insurance Benefits
Originally posted on F&I and Showroom
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