While the recession made getting auto loans incredibly difficult for many consumers, in recent months some have found it easier to get financing, with the auto industry recording better sales numbers. With automakers such as Ford and General Motors reporting higher profits, the market for those who may need to borrow is steadily improving.
The New York Times reports that it's not only people with stellar credit histories who are getting the chance to take out auto loans. Consumers who would have been considered too risky in the past have been able to get financing after previously struggling to do so. A report from CNW Marketing Research Found that in 2010 more than 859,000 new cars were sold to customers with subprime credit ratings, 60 percent higher than the prior year. Many economists believe that the willingness of lenders to take on clients with less-than-stellar credit is a sign that they have become less resistant to risk. It also means that consumers are purchasing new vehicles at an increased rate. In a recent interview with the Times, Michael E. Maroone, president of a network of 200 auto dealerships, said that the increase in credit being given by dealers is one of the biggest reasons for the uptick in sales. He said that the lack of financing had been a major roadblock for people looking to get a new car in the past. "We had people coming to our showrooms that wanted to buy, but we couldn't get them financed," Maroone told the paper. "We are now getting them the financing." Many people have been surprised by the shift in the automotive financing market. Kevin Lauterbach of Coral Spring, Florida, said that he had been wary of trying to secure a loan and was pleased with how easy it was to obtain one at a recent visit to a Jeep dealership. "My credit wasn't great, and what I had been hearing is that credit is tight right now," he told the Times. "But it wasn't really as difficult as I was anticipating." In 2010, auto dealers were able to recover from some of the worst years in their history. General Motors reported $4.67 billion in profits in 2010, the first time it had been in the black since 2004.