Auto Lenders and Tariffs Are Setting Some Car Shoppers Back

Changes in Auto Lending Standards

Auto lenders have become increasingly selective in their approval processes, particularly following the pandemic. Many lenders now require higher credit scores and larger down payments due to a surge in delinquencies and payment defaults that occurred when borrowers struggled to keep up with larger loans. This tightening of standards means that even though loans are still available, they are predominantly offered to individuals with better credit profiles, leaving those with lower scores facing higher interest rates or more stringent approval criteria. Consumers looking to secure financing should be prepared for these changes and may need to explore alternatives such as co-signers or seeking loans from credit unions for potentially more flexible terms.