Wells Fargo Faces Competition as It Pushes for Volume

Wells Fargo & Co.’s renewed push into the auto finance space is likely driven by a desire to fund higher yielding loans in a rising interest rate environment, one dealer told Auto Finance News. Wells Fargo Chief Executive Tim Sloan announced the bank’s intentions in the space earlier this month. “We’ve pulled back enough, and […]

Lenders Pull Back Financing to Subprime Tiers in Favor of Prime, Experian Says

New vehicle loans made to subprime and deep subprime consumers are decreasing as prime and superprime consumers are receiving the highest volume of new-vehicle funding they have received since 2012, according to Experian’s first quarter State of the Automotive Finance Market report. Specifically, subprime and deep subprime consumers received a 22.5% fewer new-vehicles loans in the first […]

Something has to Give: How Bloated Incentives are Harming the Industry

New vehicles are getting more expensive, but so far those price increases have done little to dissuade consumers from pulling the trigger on new-car purchases or leases because manufacturer incentives have been so generous. However, incentives and production could be taking a downturn as auto sales slow. Average incentive spending through February rose year over […]

Say Goodbye to 0% Interest

After three years of marginal interest rate hikes, auto lenders and dealers are saying goodbye to zero percent financing offers. Zero percent interest offers fell to 7.4% of total new car sales in March compared with 11% of sales the year prior, according to Edmunds. Additionally, the average interest rate on new car loans climbed […]

Share of Subprime Loans Falls to Record Low in 4Q, Experian Says

The share of nonprime, subprime, and deep-subprime loans as a percentage of total outstandings hit a record low in the fourth quarter, according to Experian’s latest report. New vehicle loans and leases to nonprime consumers fell to 19.64% of total outstandings, compared with 19.77% during the same period the year prior. Similarly for used loans, […]

Buy-Here, Pay-Here Poised to Grow in 2018, Black Book Says

Buy-here, pay-here dealers could “get back into the mix” of auto financing in 2018 after being largely shut out by increased bank competition, Anil Goyal, executive vice president of operations at Black Book, told Auto Finance News. In the first quarter of 2011, buy-here-pay-here dealers held a market share of 9.5% of used financing and […]

Rising Delinquencies Dominate 2017’s Top Subprime Headlines

Despite the overall popularity of subprime, the sector has faced significant losses and increased fragmentation this year. While Credit Acceptance and Westlake Financial Services continue to express interest in subprime lending, Fitch Ratings found subprime ABS delinquencies have spiked to a 20-year high. Additionally, a stress test from S&P Global indicated a rise in both […]
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