People who may have a less-than-ideal credit history but are looking to buy a used car may be in luck. Auto lenders are becoming more likely to assume greater risk as competition continues to rise in the industry, Automotive News reports.<\/p>\n
Experts say there are a number of signs that suggest lenders are becoming more likely to approve applications from people with poor credit scores. Perhaps the most significant is that the number of subprime and nonprime auto loans has been on the rise. Experian Automotive found the number of subprime loans – loans given to people with a credit score between 550 and 619 – rose by 13.5 percent compared to last year. The same could be said for nonprime, which experienced a 10.5 percent jump, the publication reports.<\/p>\n
Competition is also good news because lenders are becoming more likely to approve long term loans, which results in lower monthly payments. Though longer terms may have been frowned upon in the past, that's changed as drivers look to hold on to their cars longer than ever before.<\/p>\n
"We are certainly expanding in very-long-term loans," Melinda Zabritski, the director of automotive credit for Experian, told the news source. "And we're writing longer-term loans for higher-risk customers, since those are the ones who need the longer terms to obtain a monthly payment they can afford."<\/p>\n