A new report by JD Power has found that lenders in the car loan business are making dealers happier by approving more loans, suggesting that lenders who approve more car loans stand to improve their relationship with a dealer.
The report found a correlation between dealers who are highly-satisfied with their lenders and the amount of auto loans that the lender approved. Dealers with the highest level of satisfaction saw loan approval rates of about 55 percent, while those who weren’t as satisfied saw loan approval rates drop to 25 percent.
The relationship between dealers and lenders is an important one. When a buyer goes into a dealer looking for a car loan, that dealer will often refer them to a lender, who may or may not approve them. A higher rate of approval for a lender is good news for both the dealer and consumer, as it greatly increases the likelihood of a sale.
Fortunately for consumers, there are a number of lenders who will offer bad credit auto loans, even for consumers whose credit is less than ideal.
In addition, those engaging in bad credit auto loans saw dealer scores rise by 50 points compared to 2009, suggesting that more car loans are being approved to the satisfaction of both dealer and consumer.