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Auto loan terms continue to loosen for all buyers

The Boston Globe -- For car buyers seeking auto loans, happy days are here again. Banks and auto finance companies are once again welcoming all kinds of customers, even those with less-than-stellar credit.

Low interest rates are making it cheaper for banks to get money, which makes them more willing to lend. The federal funds rate — the rate at which banks lend to each other — is near zero percent, down from 2 percent in summer 2008.

Loans to subprime buyers — buyers with credit scores of 679 or lower — are particularly attractive, since banks can charge higher interest rates. The average interest rate for a deep subprime loan, to someone with a credit score below 550, is 12.9 percent for a new car, compared with 3.2 percent for buyers with the highest scores, according to Experian Automotive.

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Submitted Jul 20, 2012 By: angel4me

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honda0105 Champion Author Tallahassee Posts:18,610 Points:1,608,545 Joined:Nov 2008	Message Posted: Jul 23, 2012 2:52:50 AM Ignore honda0105 Report Abuse gonna be another bubble, just like housing. Esp. if another Cash 4 Clunkers is coming down the pipe.
Soglaos Champion Author Virginia Beach Posts:2,770 Points:737,235 Joined:Feb 2011	Message Posted: Jul 21, 2012 7:51:13 PM Ignore Soglaos Report Abuse I understand why
Wizrd03 Champion Author Illinois Posts:8,147 Points:1,631,360 Joined:Oct 2008	Message Posted: Jul 21, 2012 6:20:18 AM Ignore Wizrd03 Report Abuse Old news
1WI All-Star Author Appleton Posts:818 Points:274,255 Joined:Jan 2012	Message Posted: Jul 20, 2012 11:30:58 PM Ignore 1WI Report Abuse No one wants to lose their wheels.
Dodge_Me Champion Author Atlanta Posts:2,214 Points:555,480 Joined:Mar 2006	Message Posted: Jul 20, 2012 9:09:59 PM Ignore Dodge_Me Report Abuse Now if only the housing market would step up also
jrschl Champion Author Louisville Posts:2,962 Points:680,090 Joined:Jun 2011	Message Posted: Jul 20, 2012 9:06:00 PM Ignore jrschl Report Abuse I suppose this can relate to gas prices.
JamesCalvin Champion Author Lancaster Posts:3,181 Points:518,480 Joined:Nov 2011	Message Posted: Jul 20, 2012 9:04:37 PM Ignore JamesCalvin Report Abuse Who has money to loan???? OH... I forgot>>>> They jus printed a new batch of bills!
Ethan777OH Veteran Author Ohio Posts:270 Points:25,720 Joined:May 2011	Message Posted: Jul 20, 2012 9:01:11 PM Ignore Ethan777OH Report Abuse cool
mrbee Champion Author Little Rock Posts:3,753 Points:2,465,610 Joined:Oct 2005	Message Posted: Jul 20, 2012 9:00:45 PM Ignore mrbee Report Abuse But will they have to be bailed out again?
NedW Champion Author Indianapolis Posts:5,609 Points:1,141,270 Joined:Mar 2008	Message Posted: Jul 20, 2012 8:57:56 PM Ignore NedW Report Abuse Cool! I wonder if I can get a Corvette ZR1 now? Oh. I forgot...Government Motors.
bra0712 Champion Author Arizona Posts:3,660 Points:767,595 Joined:Nov 2008	Message Posted: Jul 20, 2012 8:57:45 PM Ignore bra0712 Report Abuse K
Ethan777OH Veteran Author Ohio Posts:270 Points:25,720 Joined:May 2011	Message Posted: Jul 20, 2012 8:56:20 PM Ignore Ethan777OH Report Abuse yeah..sure...seeing tons of people with bad credit getting approved...yep,yep...
Vitobug Champion Author El Paso Posts:1,955 Points:639,935 Joined:May 2011	Message Posted: Jul 20, 2012 8:55:00 PM Ignore Vitobug Report Abuse ok
fenster66 Champion Author Pittsburgh Posts:3,345 Points:673,115 Joined:May 2011	Message Posted: Jul 20, 2012 8:52:02 PM Ignore fenster66 Report Abuse seems like deja vu....
suzmar Champion Author Texas Posts:2,212 Points:871,990 Joined:Jun 2006	Message Posted: Jul 20, 2012 8:51:28 PM Ignore suzmar Report Abuse Okay, isn't this how banks got in trouble with mortgages and student loans?
Marson Champion Author Scranton Posts:8,942 Points:2,077,185 Joined:Oct 2006	Message Posted: Jul 20, 2012 8:49:01 PM Ignore Marson Report Abuse Better keep your score up!
JENNYHK Champion Author Chicago Posts:3,636 Points:712,570 Joined:Apr 2011	Message Posted: Jul 20, 2012 8:45:55 PM Ignore JENNYHK Report Abuse ok.
RAKARWOWSKI Champion Author Chicago Posts:3,995 Points:820,050 Joined:Jan 2011	Message Posted: Jul 20, 2012 8:43:44 PM Ignore RAKARWOWSKI Report Abuse ok.
abcdMA Champion Author Worcester Posts:7,922 Points:1,574,980 Joined:Nov 2008	Message Posted: Jul 20, 2012 8:42:22 PM Ignore abcdMA Report Abuse will we ever learn?
drz614 Champion Author Harrisburg Posts:2,299 Points:597,620 Joined:Aug 2011	Message Posted: Jul 20, 2012 8:36:34 PM Ignore drz614 Report Abuse ok
mstearno Champion Author Dayton Posts:8,066 Points:1,731,235 Joined:Jan 2008	Message Posted: Jul 20, 2012 8:34:25 PM Ignore mstearno Report Abuse great next recession will prove hurtful
slayur Champion Author Chicago Posts:1,533 Points:1,216,770 Joined:Sep 2005	Message Posted: Jul 20, 2012 8:32:35 PM Ignore slayur Report Abuse lol
sillywagon Champion Author New York Posts:14,883 Points:1,440,370 Joined:Oct 2008	Message Posted: Jul 20, 2012 8:32:23 PM Ignore sillywagon Report Abuse Sub-prime auto loans? This is not good.
DarthDadJr Champion Author Virginia Posts:7,307 Points:1,520,445 Joined:Jul 2008	Message Posted: Jul 20, 2012 8:28:55 PM Ignore DarthDadJr Report Abuse I hope they stay low for one more year...need to get a new van for the wife next year.
N5EXY Champion Author Austin Posts:5,490 Points:1,509,590 Joined:Jul 2004	Message Posted: Jul 20, 2012 8:28:36 PM Ignore N5EXY Report Abuse This could be worse than the housing loan fiasco. Real estate usually appreciates. Motor vehicles always depreciate rapidly as soon as they are titled and driven away from the dealership. Result, big debt with no equity.
a_lu_vasile Champion Author Maryland Posts:1,254 Points:775,450 Joined:Jul 2008	Message Posted: Jul 20, 2012 8:23:48 PM Ignore a_lu_vasile Report Abuse ok
REKEY Champion Author South Carolina Posts:8,579 Points:1,699,415 Joined:May 2008	Message Posted: Jul 20, 2012 8:23:12 PM Ignore REKEY Report Abuse Still can't afford one!
hauler43 Champion Author Oakland Posts:8,158 Points:2,597,750 Joined:Sep 2003	Message Posted: Jul 20, 2012 8:22:47 PM Ignore hauler43 Report Abuse OK
clermont40miles Champion Author Cincinnati Posts:10,569 Points:1,771,920 Joined:Apr 2008	Message Posted: Jul 20, 2012 8:19:06 PM Ignore clermont40miles Report Abuse Not a good time to go deep into debt. Debtor is slave to the lender. Stay free.
96sc1 Champion Author El Paso Posts:8,517 Points:1,367,440 Joined:Mar 2008	Message Posted: Jul 20, 2012 8:18:58 PM Ignore 96sc1 Report Abuse Loan terms are already way to loose.
walkingtall Champion Author Toronto Posts:3,994 Points:1,120,705 Joined:Nov 2004	Message Posted: Jul 20, 2012 8:16:30 PM Ignore walkingtall Report Abuse Auto loan terms continue to loosen for all buyers and the happy days are here again if you can afford to pay the amount on time.
Blue48 Champion Author Illinois Posts:7,305 Points:1,637,945 Joined:Feb 2007	Message Posted: Jul 20, 2012 8:15:54 PM Ignore Blue48 Report Abuse WHATEVER!
esq262 Champion Author Asheville Posts:2,897 Points:647,515 Joined:Jul 2011	Message Posted: Jul 20, 2012 8:13:13 PM Ignore esq262 Report Abuse Pay cash.
Tekkersmom57 Champion Author Syracuse Posts:1,874 Points:700,215 Joined:May 2010	Message Posted: Jul 20, 2012 8:11:30 PM Ignore Tekkersmom57 Report Abuse Happy days are here again if you can afford to pay the amount on time.
skybiker Champion Author South Carolina Posts:7,292 Points:1,559,415 Joined:Jul 2008	Message Posted: Jul 20, 2012 8:09:32 PM Ignore skybiker Report Abuse Insurance prices are still too high....
Lukus Champion Author Halifax Posts:8,279 Points:1,674,375 Joined:Nov 2007	Message Posted: Jul 20, 2012 8:08:34 PM Ignore Lukus Report Abuse They want to suck you in and then claim the vehicle back.
aggietim Champion Author Fort Worth Posts:1,756 Points:693,325 Joined:Oct 2008	Message Posted: Jul 20, 2012 8:07:25 PM Ignore aggietim Report Abuse good
MahopacJack Champion Author New York Posts:8,011 Points:1,582,995 Joined:Feb 2008	Message Posted: Jul 20, 2012 8:04:10 PM Ignore MahopacJack Report Abuse Should prove somewhat helpful but a rosier job outlook would be better.
AnObserver Champion Author New Jersey Posts:8,354 Points:2,257,780 Joined:Sep 2005	Message Posted: Jul 20, 2012 7:58:06 PM Ignore AnObserver Report Abuse With interest rates at all time lows and the auto industry pushing to recover, the good deals are understandable
jad1960 Champion Author Gary Posts:1,540 Points:402,450 Joined:Feb 2012	Message Posted: Jul 20, 2012 7:57:07 PM Ignore jad1960 Report Abuse Whatever
vulcan96 Champion Author Ohio Posts:26,896 Points:3,102,700 Joined:Aug 2004	Message Posted: Jul 20, 2012 7:57:03 PM Ignore vulcan96 Report Abuse go for it - get a 40+ mpg car
knot2swift Champion Author Calgary Posts:4,384 Points:697,000 Joined:Nov 2009	Message Posted: Jul 20, 2012 7:52:40 PM Ignore knot2swift Report Abuse I got screwed so bad with my Toyota Carolla. Back in the days before the Depression, I could only get 0% for 36 months. Nothing like paying off a car in 3 years! $685.15 a month is hard to take even if it is interest free. 3 more idiot payments! Then I'll have a lot of money to waste on the house. The stupid thing in my driveway is such a pain! Come October, NO MORE PAYMENTS ON THE DECOUR IN MY DRIVEWAY! [Edited by: knot2swift at 7/20/2012 10:55:36 PM EST]
dong1971 All-Star Author Vancouver Posts:660 Points:217,765 Joined:May 2012	Message Posted: Jul 20, 2012 7:50:59 PM Ignore dong1971 Report Abuse I don't care.
allstar3 Sophomore Author Baton Rouge Posts:136 Points:71,700 Joined:Dec 2011	Message Posted: Jul 20, 2012 7:50:19 PM Ignore allstar3 Report Abuse Won't be long for the next bailout.
MadTraveler Champion Author Idaho Posts:2,082 Points:572,100 Joined:Nov 2009	Message Posted: Jul 20, 2012 7:49:53 PM Ignore MadTraveler Report Abuse Nice.
Spankster85 Champion Author Chicago Posts:1,724 Points:356,090 Joined:Nov 2011	Message Posted: Jul 20, 2012 7:49:02 PM Ignore Spankster85 Report Abuse 12.9 percent...kinda rough.
rcornel All-Star Author San Diego Posts:721 Points:227,285 Joined:Jun 2012	Message Posted: Jul 20, 2012 7:47:09 PM Ignore rcornel Report Abuse Wow... Ok!?!
bvrbill Champion Author Eugene Posts:3,217 Points:517,775 Joined:Jul 2011	Message Posted: Jul 20, 2012 7:46:44 PM Ignore bvrbill Report Abuse We'll be seeing more loan defaults.
papa56NC All-Star Author North Carolina Posts:725 Points:142,760 Joined:Apr 2012	Message Posted: Jul 20, 2012 7:45:32 PM Ignore papa56NC Report Abuse Git-ur-dun then
judgemobile Champion Author Ohio Posts:7,565 Points:2,444,160 Joined:Nov 2005	Message Posted: Jul 20, 2012 7:43:49 PM Ignore judgemobile Report Abuse when interest rates go NEGATIVE, and they pay me money to borrow, then the economy has tanked. Are you listening Geithner and Bernanke ? QE to infinity.