Chrysler Financial, previously the lending arm of big three automaker Chrysler, may soon resume lending, according to an insider familiar with the company’s plans. The company will begin by lending to buyers with near-prime credit, but may eventually begin offering bad credit auto loans again.
When Chrysler announced its bankruptcy, the lending arm was split off from the main automaker. Fiat purchased the automaker side of Chrysler, while a controlling 20 percent stake in Chrysler Financial went to Cerberus Capital Management.
Chrysler Financial, who previously handled the lending for its namesake auto dealers, is now weighing its options, according to BusinessWeek. Since the bankruptcy debacle, the company has mostly stuck to collecting on its previous loans, and loaned out less than $100 million last year. Cerberus is considering plans to raise capital and possibly changing its name.
GMAC, which spun off from GM around the same time, is also owned by Cerberus. That company changed its name to Ally Financial and currently lends to Chrysler dealers.
Chrysler Financial is also entertaining the possibility of contacting auto dealers in order to finance their inventory purchases, according to the news source.
Consumers may want to keep an eye on these developments, as more lenders means more options when it comes time to buy a car, and rates fluctuate based on the company and brand.