Auto Loans for Buyers with Lower Credit Scores from Loans Network Ltd Helping Drive Auto Sales in 2013 to Near Pre-Recession Levels of 2007

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In 2007, a year before the recession, new car sales reached a record 17 million in sales. Now sales are projected to reach 16 million by the end of 2013.

Auto loan lending networks, such as Loans Network Ltd, are becoming a vital part of economic recovery. As they help consumers with credit scores below 640 locate lenders willing to provide them car loans. In the first half of 2013, eleven percent of new car loans were sub-prime. Sub-prime means the interest rate on the loans is above the prime rate. Normally, a car buyer with an excellent credit score would qualify for the prime rate.

A July 2013 issue of USA Today quoted Karl Brauer, a senior analyst at the car pricing guide service Kelley Blue Book. He pointed out that “credit is definitely playing a key role in the industry's rebound because of the availability of easy financing, not just for those with perfect credit but also for those who don't have the good scores.” According to the same article, car loans for those with lower credit scores now comprise about 11% of new auto sales and that is almost twice the percentage of those types of loans at the peak of the recession in 2009.

Before the recession, auto loans for credit challenged buyers averaged about 13% a year. Now many independent lenders and captive lenders (the in-house lenders for the car dealerships) are lending more aggressively. Independent or direct lenders are offering fast qualifying and competitive interest rates even for those with bad or poor credit.

How can consumers find these lenders? Many auto dealerships receive incentives to get buyers to use their captive lenders. Smart borrowers realize they have the strongest negotiating position when they go to sites like and get pre-approved for an auto loan before they go to the dealership. They also find that these sites offer them access to dozens of lenders who compete for their business.This competition means lower interest rates and better loan terms for car buyers with credit challenges. understands that borrowers want a fast application process and want to take care of everything online. So they make it easy and fast to fill out an application and receive a car loan approval through their website. As long as direct lenders are willing to lend and sites, such as provide fast and easy access to these lenders the increase in bad credit auto loans should continue to trend upwards.

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Yonni Rossa
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