Lenders increase range of credit scores

Lenders increase range of credit scoresA recent study by the consulting firm A.T. Kearney suggested that lenders go after a wider range of credit scores, as buyers who may have had their scores drop during the recession might not be as much of a risk as their scores indicate.

It now appears as if lenders are doing exactly that, according to a recent article in the Financial Times. Early data from May by CNW Research indicates that the average credit score being approved for auto loans is at its lowest point in five years.

In addition, borrowers with a credit score of less than 670, typically considered to be "risky" by lenders, now make up 14.5 percent of all auto loans. Both pieces of data indicate that more bad credit auto loans are available and lenders are considering buyers with a broader range of scores.

If you're in the market for a vehicle, it might pay to consider applying for an auto loan. Even if you've been rejected in the past, lending standards have changed rapidly over the past few months as more lenders look to facilitate auto sales. Applying online is simple, secure and fast, so there's no reason to delay.