Credit Scores Approach Pre-recession Levels in Q1, Experian Reports
Not only did finance sources finance more customers with lower credit scores, they lowered interest rates and extended terms to help fuel vehicle sales.
SCHAUMBURG, Ill. — Average credit scores for consumers buying a vehicle dropped to near pre-recession levels in the first quarter, Experian Automotive reported today, while lenders continued to offer favorable terms to attract car buyers.
According to the firm’s quarterly automotive credit analysis, the average credit score for financing a new vehicle dropped six points to 760, while the average score for used car buyers fell four points to 659. Comparatively, average credit scores in the first quarter 2008 stood at 753 for new vehicles and 653 for used.
“During the first quarter of 2012, car shoppers definitely found more favorable conditions for their vehicle loans,” said Melinda Zabritski, director of automotive credit for Experian. “A reduction in average credit scores, lower interest rates and a lengthening of loan terms are all very good signs for the market and offer great opportunities for consumers looking to make a deal on a new or used vehicle.”
The analysis also showed an increase in the average amount financed, which rose by $589 during the quarter to $25,995. For used vehicles, the average amount financed increased by $411 to $17,050.
“Our report shows automotive lending is as healthy as it’s been since the market bottomed out in 2008,” Zabritski noted. “With consumers doing a good job of paying back loans on time and the percentage of dollars at risk reaching its lowest point in six years, lenders are able to extend terms and provide lower rates. This thawing of the credit pipeline has been good for everyone, from consumers to lenders to automotive retailers.”
The first quarter also saw vehicle loans made to nonprime, subprime and deep-subprime customers increase by 11.4 percent. Auto repossession rates dropped by 37.1 percent, while 30-day delinquencies dropped by 7.6 percent and 60-day delinquencies dropped by 12.1 percent.
Banks and credit unions saw their share of the auto finance market grow by 7.5 percent to 40.21 percent, while credit unions grew their share by 10.5 percent to 16.89 percent.
More F&I
Trust Is Personal
Technology, no matter how efficient, can’t replace what the human F&I manager can do, which is to bridge the divide between cyberspace and the in-store experience.
Read More →
Amplify 2026 Billed as Turning Innovation Into Results
Reynolds and Reynolds says its annual retail summit will connect dealers with practical strategies, peer insight, and technology-driven ideas.
Read More →
Own Your Outcome: F&I in the Digital Customer Journey
Finance has historically been the last step in the car-buying process, but it doesn’t have to be. The customer’s journey starts long before they arrive at the dealership, and so should F&I’s involvement.
Read More →
Tariffs Could Raise Insurance Premiums
As U.S. import tariffs affect repair costs, consumers might find it more affordable to replace a damaged vehicle, according to recent Insurify tariff analysis.
Read More →
Smaller Loans, Longer Terms
The youngest generation of car buyers is more likely to finance less expensive vehicles, more than half of generation Z consumers borrowing less than $25,000.
Read More →
New Lifetime Battery F&I Product Meant to Drive Dealer Traffic
EFG Cos. offering is intended to create lifetime auto dealer engagement with customers.
Read More →
The Psychology Behind Menus That Increase Add-On Sales
There is a science to crafting a menu that gives customers confidence in the choices presented, and moving the process outside the F&I office can further boost results.
Read More →
Why Your F&I PVR Is Misleading You
Here’s a handy checklist of the numbers to track in 2026 instead.
Read More →
Auto Consumer Anxiety Presents Opportunity
A survey of U.S. drivers found the majority are concerned about finances and the economy, but those fears make many ready to buy vehicle-protection products.
Read More →
Humble and Hungry: 12 Rules for an F&I Life
Dustin Gingerich, with a decade in the F&I business under his belt, shares his thoughts on leadership, building trust with customers, and the importance of learning and innovation.
Read More →