• News
  • Guides
  • Reviews
  • Media
  • About
  • News
  • Guides
  • Reviews
  • Media
  • About
Sign up Now (For Free)

Sign up for our newsletter and receive the latest automotive news in your inbox!

Invalid email address
We promise not to spam you. You can unsubscribe at any time.
Thanks for subscribing!
News
Read Now
  • All News
  • Automakers
  • Automobiles
  • Auto Shows
  • Business
  • EVs & Environment
  • Guides
  • Lawsuits/Legal
  • Regulatory
  • Ride-Sharing
  • Safety & Recalls
  • Technology
Recent
  • The Rearview Mirror: Triumph of the Bean Counters
  • VW Teases U.S. Version of ID.Buzz — and Here’s What We Know About the Electric Microbus
  • Make Sure You're Good to Go for the Holiday Weekend
  • Hyundai, LGES Building $4.3B EV Battery Plant in U.S.
  • New Vehicle Sales Set to Rise, Used Vehicle Sales Expected to Drop in May
  • Ford Teaming with Tesla to Make Charging Even Easier
  • Q&A: VinFast CEO Van Anh Nguyen Talks Tough Reviews, Tough Learning Curve, Bright Future
  • Stellantis Invests in new Lithium-Sulfur EV Battery Tech
  • The Safest Cars For Your Teenage Driver
  • Honda Teams with Aston Martin in Formula One Return
Editor’s Choice
    Reviews
    Read Now
    • All Reviews
      • Feeder
    • Classic Cars
    • Concept Cars
    • Convertibles
    • Coupes
    • Crossovers/CUVs
    • Diesel
    • Hot hatches
    • Hybrids
    • Luxury Vehicles
    • Minivans
    • Muscle Cars
    • Pickups
    • Sedans
    • Sports Cars
    • Super Cars
    • SUVs
    Recent Reviews
    • A Week With: 2023 Electrified GV70 AWD Prestige
    • A Week With: 2023 BMW XM
    • A Week With: 2023 Mercedes-Benz GLS 580 4Matic
    • First Drive: 2024 Audi Q8 e-Tron Prestige
    • First Drive: 2024 Volvo C40 Recharge Single Motor
    • A Week With: 2023 Ford Bronco Everglades Edition
    • First Drive: 2024 Kia Seltos
    • A Week With: 2023 Volvo V60 Cross Country B5 AWD
    • 2023 Kia Sportage PHEV X-Line Prestige AWD
    • First Drive: 2023 VinFast VF 8 City Edition
    Editor’s Choice
      Guides
      Car Warranty
      • Endurance Warranty Reviews
      • BMW Extended Warranty
      • Extended Warranty For Cars Over 100k Miles
      • Extended Car Warranty Cost
      • Subaru Extended Warranty
      • CarShield Reviews
      • CarShield Cost
      • Aftermarket Car Warranty
      • CARCHEX Warranty Reviews
      • Reputable Extended Car Warranty Companies
      • Used Car Warranty Companies
      • Best Car Warranty
      • Is CarShield A Scam?
      • Mercedes Extended Warranty
      • CarShield Plans
      Insurance
      • How To Identify A Car Insurance Company
      • Geico Mechanical Breakdown Insurance
      • How Far Back Does A Car Insurance Company Look
      • Mechanical Breakdown Insurance For Used Cars
      • State Farm Mechanical Breakdown Insurance
      • Mechanical Breakdown Insurance From Progressive
      • Dollar A Day Insurance
      • Auto Insurance For SSI Recipients
      • Car Insurance Rates After A Suspended License
      • Auto Insurance For Salvage Vehicles
      • Average Cost of Dodge Ram 1500 Car Insurance
      • Car Insurance Florida
      • Full Coverage Auto Insurance
      • GrubHub Insurance
      • Amazon Delivery Auto Insurance
      Shipping
      • Car Shipping Companies
      • uShip Reviews
      • Auto Shipping From California To Hawaii
      • Montway Auto Transport Reviews
      • Cheap Car Shipping
      • Easy Auto Ship Reviews
      • Auto Shipping Miami
      • Auto Shipping To Alaska
      • Car Shipping Cost
      • Auto Shipping Hawaii
      • Auto Shipping Puerto Rico
      • Sherpa Auto Transport Reviews
      • Auto Shipping Atlanta
      • Auto Shipping Boston
      • Auto Shipping. Chicago
      About
      • About Us
      • Contact Us
      • Terms of Use
      • Privacy Policy
      • Affiliate Disclosure
      • Sitemap
      TheDetroitBureau.com

      More than just “another” place to find news, reviews, spy shots, commentary, features, and guides about the auto industry. TheDetroitBureau doesn’t stop with the press releases or confuse a few lines of opinion with insightful, in-depth reporting.

      Contact Us

      Like what you see? Have some ideas for making The Detroit Bureau.com even better? Let us know, we’d love to hear your voice.

        Media
        Listen Now
        • Headlight News: All Episodes
        More from TheDetroitBureau
        • Guides
        • Latest News
        • Auto Reviews
        • Podcasts
        Headlight News

        TheDetroitBureau.com’s Headlight News offers a look at the past week’s top automotive news stories, as well as what’s coming up in the week ahead. Check out the week’s top story and our latest review…along with a dive into the past with this week in automotive history.

        home > news > Automobiles > Lenders Cutting Back on Subprime Loans

        Lenders Cutting Back on Subprime Loans

        Credit challenged getting fewer loans and less money.

        Michael Strong
        Michael Strong , Managing Editor
        Sept. 03, 2014
        Lenders are loaning less money, less often to subprime and deep subprime buyers these days.

        While auto sales sizzled in August and have been brisk for the year, the lenders helping to move that metal are no longer relying on the subprime buyers to keep the good times rolling.

        The percentage of new vehicle loans going to consumers in the subprime and deep subprime segments was at 15.1% in Q2 2014, down from 22.1% in Q2 2013, according to Experian Automotive. Subprime buyers have credit scores ranging from 619 down to 550 while deep subprime is anyone below 550.

        Subscribe and Stay on Top!

        The numbers are still higher than the low of 10.2% during the depths of the recession in 2009, the current figures are still well below the prerecession level highs of 16.6% in Q2 2008 and 19.9% in Q2 2007, the company reported.

        “Although we’ve seen relative stability in the automotive industry the past several years, lenders are still showing cautionary signs when lending to the subprime market and keeping their risk at manageable levels,” said Melinda Zabritski, senior director of automotive finance for Experian, in a statement.

        The average monthly payment for new and used vehicles hit new highs during the second quarter. The average monthly payment for a new vehicle jumped $10 to $467 while the used car payment rose $4 to $355.

        (Automakers defy expectations with August sales. For more, Click Here.)

        “As for consumers, as long as those in these higher risk segments continue to pay their bills on time, keep delinquent balances in check and select a vehicle that fits within their budget, they should still be able to obtain the necessary financing to purchase a vehicle that meets their needs.”

        (To see more about the Land Rover’s new Discovery Sport, Click Here.)

        A few other trends about buyers, include:

        • Of all new vehicles sold in Q2 2014, leases accounted for a record high 25.6%, up from 23.4% the previous year
        • The interest rate for a new vehicle was up from 4.46% in Q2 2013 to 4.59% in Q2 2014
        • Used vehicle interest rates were up from 8.56% in Q2 2013 to 8.82% in Q2 2014
        • The average credit score for a new vehicle loan in Q2 2014 was 711, up from 699 a year earlier
        • The average credit score for a new vehicle lease rose to 717 in Q2 2014 from 706 in Q2 2013

        Not only are they lending less often to subprime and deep subprime buyers, they’re giving them less money as well. For new cars, the drop is smaller for subprime borrowers than deep subprime: .8% compared with 2.6%.

        (Click Here for details on luxury makers stretching out their long wheel-base models.)

        The average new vehicle loan amount to a subprime borrower dropped to $27,347 in Q2 2014 from $27,563 in Q2 2013, and new loans to deep subprime borrowers fell to $24,836 in Q2 2014 from $25,486 in Q2 2013.

        The average amount financed rose in Q2 2014 to $27,429 from $26,526 in Q2 2013.

        For used vehicles, the average subprime borrower loan fell to $16,546 in Q2 2014 from $17,020 in Q2 2013. Used deep subprime loans fell to $14,358 Q2 2014 from $15,113 in Q2 2013.

        How to Care for Your Car

        Cheap Car Warranty

        Editor's Choice

        Best Extended Car Warranty

        Editor's Choice
        Recently Published

        The Rearview Mirror: Triumph of the Bean Counters

        May 27, 2023
        VW tease for ID Buzz three row

        VW Teases U.S. Version of ID.Buzz — and Here’s What We Know About the Electric Microbus

        May 26, 2023
        Hyundai and LGES handshake for GA battery plant REL

        Hyundai, LGES Building $4.3B EV Battery Plant in U.S.

        May 26, 2023

        Leave a Reply Cancel reply

        Your email address will not be published. Required fields are marked *

        Share this article:
        © The Detroit Bureau 2023
        • Guides
        • Privacy Policy
        • Terms of Use
        • Affiliate Disclosure
        • Contact Us
        • Sitemap
        Follow Us: