Automotive News reports that the “Average Joe”, who typically has a FICO score in the region of 620 to 680 is finding it easier to get car loans now. Requirements are a bit more stringent than before in terms of how much of a down payment is made, and trade-in loan balances.
I guess this means we may hear less of the “We’ll pay off your trade, no matter how much you owe” bs on radio commercials. The closing rate is also improving it seems because buyers are more realistic about their borrowing power and doing their homework more before going in to risk getting shot down for financing.
Below Average Joes tend to have scores below 620 which is considered subprime, and still have difficulty financing. Which makes sense as they have a lower probability of paying back loans.
This is one more reason why the new car market is so far down compared with its peak.