Online financing is still in its “infancy” as a buying platform, yet millennials and subprime consumers increasingly turn to apps for information and loan shopping, said Andy Mayers, vice president of lender solutions and product strategy at Cox Automotive.
“Is online lending still for people who are credit-challenged? The data shows that it still is,” Mayers said at the Subprime Forum last week. “Subprime is not the only group, but it’s still very penetrating.” Consumers with a credit score of 550 or lower have grown to 30% of total online submissions, and between 2011 and 2016, millennials have grown to 45% from 40% of total subprime applications, he said.
“As millennials grow into the market [economy], they are also shifting subprime credit up into the auto space, as well,” Mayers said. Despite those stats, the subprime trend in online lending cuts across age demographics and, for now, “people who are frustrated, are trying to use the online tools to speed up the process in the store,” he added.
