Subprime Auto Finance

Subprime Auto Financing: if you suffer from negative credit history, typically defined by a FICO score of 640 or lower, you’re not alone.  According to a representative of Special Finance Magazine, 30-35% of all applicants have weak credit — that’s over 100 million US citizens!

When borrower credit is bad, the auto loan is termed “subprime.”  That said, the rise of subprime lending has grown beyond the scope of credit alone.  According to a 2006 report from The Wall Street Journal, more than 60% of subprime loans go to borrowers with credit scores high enough to qualify for “prime” financing.

Subprime Auto Financing

At Auto-Finance-Rates.com, we understand that 3-4 out of every 10 visitors are suffering from bad credit, and therefore in need of subprime auto financing.   Our national network of auto finance companies, dealers, and lenders includes a wealth of expertise in subprime vehicle finance.  When you apply through our site, we use Advanced Data-Mapping Technology to match you to the lender most likely to approve your loan.

How to Get Approved for Subprime Auto Finance:

1. Complete our auto financing application.
2. Know your data is safe via SSL encryption.
3. Get approval status and rate quotes from your optimum lender.
4. Finalize your financing terms with your lender.
5. Purchase your new vehicl.
6. Watch your credit improve as you pay off your bad credit loan.

>> Get Approved for your Subprime Auto Financing

The Subprime Market and Predatory Lending

Back in 2007, the “credit crunch” made subprime the official word of the year and revealed a shady side of the subprime market:  predatory lending practices.  Consumers with poor credit who were desperate for loans were being taken advantage of in a variety of ways.  Most of the attention centered on the housing market, but we would like to make you aware of abusive and predatory lending practices common to the auto finance market:

• Dealer Kickbacks: a recent study by The Center for Responsible Lending found that dealer “kickbacks” added an extra $642 to every vehicle sold.  Kickbacks, otherwise known as dealer markups, occur when the dealer and lender agree to increase the buyer’s interest rate.  In only a handful of states has legislation been put in place to prohibit this practice.
• The Yo-Yo Scam: another abusive practice common to the subprime market.  This involves a buyer being called back to the dealership because they were placed in a conditional sale agreement that could not be finalized. The buyer, of course, thinks he or she had already bought the car.   At that point, he or she is forced to rework financing to their disadvantage (higher interest rates are common).
• Loan-Packing: in this case, a dealer representative convinces the buyer that he or she is in need of warranties, vehicle service contracts, credit life insurance, and other “packed-on” items design largely for profit rather than need.  By the time the buyer drives off the lot, he or she has spent much more on their vehicle than they expected.