How Subprime Financing Can Help You Grow Your Car Business
The Lot Blog
There is a significant number of car buyers who have difficulty getting approved for financing through traditional lenders due to having bad credit or no credit history. According to Experian’s 2019 Q2 State of the Automotive Finance Market report, approximately 19 percent of car buyers have subprime credit scores (580 to 619) and a little over 18 percent of car buyers have non-prime credit scores (620-659).
Consumers with prime to super-prime credit scores (660 and higher) typically have a better chance of obtaining credit approval through traditional lenders or finance companies than credit-challenged car buyers. This means car dealers have an opportunity to reach an underserved market of consumers who need credit approval to purchase a reliable vehicle.
Offering subprime auto financing through your dealership is a good way to provide consumers with bad credit or no credit the opportunity to purchase a reliable vehicle and potentially improve their credit with on-time car payments. Having the ability to approve every customer regardless of their credit history places you, the car dealer, in a position to expand your customer base and increase car sales.
Becoming an enrolled dealer in the Credit Acceptance auto finance program is an effective way for you to serve more customers and grow your car business. If your dealership is interested in learning about the benefits of offering subprime auto financing through our program, fill out the Become a Dealer form on our website!