Interest rates on auto loans are expected to remain at an all-time low during 2012, according to a recent analysis from financial information publisher Bankrate.com.
The lending market has opened up in recent years as banks, credit unions and car loan companies have begun taking the place of captive lenders – the financial lending branches of auto manufacturing companies. This trend, coupled with record low interest rates set by the Federal Reserve, have created a consumer-friendly lending environment for 2012, according to the analysis.
Financial problems in Europe could actually be contributing to favorable rates on car loans in the United States, the analysis suggests. As other world economies slide, U.S. debt – including car loans that have been bundled into securities – is still seen as a good investment prospect.
Individual car loan interest rates will still vary from person to person depending on credit score and other factors. The national average credit score is 692, according to scoring company Experian. Consumers with good credit scores can typically qualify for lower interest auto loans, while consumers with credit problems may qualify for subprime auto loans.
