Credit available for new car purchases may be harder for some new-car buyers to obtain. Rising delinquencies and more customer accounts that are in arrears are causing banks to consider reducing their exposure to the segment.
Jerry Reynolds, host of the Car Pro Show says that increased delinquencies and repossessions are behind the tightening credit. Existing customers are struggling with high interest rates and are upside down on their purchases, in some cases.
Increasing the amount of down payment is a sure-fire way to get better access to credit. Reynolds cautions that buyers with lower credit scores should expect to pay higher interest rates on the funds that they do borrow. Stability - same job, same address - can also help provide credit sources with more comfort that they will be re-paid.
Reynolds also points to "captive" finance companies like Ford Motor Credit, Ally (formerly GMAC) and Toyota Motor Credit as the best possible sources of possible financing if traditional sources like banks and credit unions are unavailable.
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