United States automakers are engaged in a struggle to survive and, in their fight to avoid complete insolvency, are making use of drastic, even unorthodox, measures. While, in today’s economic climate, governments bailouts seem neither drastic, nor unorthodox – everybody’s doing it, or so it seems – some of the other steps the big three are taking are certainly unusual.
It looks as if banks are lowering their standards for approving consumers for a car loan, at least a little. In March, 2009, the average FICO score for new-car buyers, 722, hit its lowest level since May 2006, according to CNW Research.
In November 2005, the average FICO score for financing a new-car buyer was 681, which was the lowest level recorded.'
The 722 average FICO score for March includes buyers who took out a car loan, lease and paid cash. It excludes commercial fleets used 80 percent or more for business.
As banks and lenders keep lowering the average FICO score required to get an auto loan, more buyers who need a car but don’t have perfect credit will be able to get approved for the car loans and leases they need.
Those in the market for a new vehicle would do well to check out the broad range of incentive programs available today. Auto manufacturers are competing against each other to provide consumers with reasons to choose their vehicles above the others. Some are offering unusually good opportunities, in light of the difficulties presented by the economic turbulence that characterizes the market today. However, it is always good to remember the wise consumer only makes the purchase if it makes good fiscal sense for him, not just because it is a great bargain.
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