Drivers with bad credit are getting car loans with increasing ease as the credit market loosens up and lenders regain confidence.
The percentage of auto loans going to bad credit drivers rose 8 percent in the third quarter of 2010, according to data issued by the credit reporting agency Experian. Only 63 percent of car loans issued during the period went to borrowers with a credit score above 680, the Associated Press reports. Last fall, in tighter credit conditions, 66 percent of car loans went to prime borrowers.
The attributes of these bad credit car loans are also becoming more favorable. Lenders are more willing to give consumers with less-than-perfect credit bigger loans that they can pay off over a longer period of time, according to the news source.
Furthermore, some experts believe the trend will continue into next year, as delinquency rates fall and lending institutions feel confident enough to take on larger risks.
Consumers with bad credit history may want to take advantage of the opportunity to shop around for an auto loan, since the credit market is currently in a phase that allows for favorable terms on such loans.