Through the economic downfall, loan requirements shut out many buyers with poor credit. A credit analysis recently released by Experian Automotive,  however, found that more buyers with poor scores are getting approved, and adding their lower scores to the mix has brought average scores down almost to pre-recession levels. A few years ago, it could have been much more difficult to get an auto loan, a lot of lenders who specialize in bad credit auto financing might not even have had the money to lend. It looks like times have changed and it seems to be a good time to buy a car!

Bad credit? No problem
Good news for car buyers this winter... .according to Experian Automotive's report on the state of automotive financing from the beginning of 2012, things are changing.
  • Buyers with lower scores are getting approved.
  • Lenders are making more loans. The report found that loans to car buyers with fair to bad credit scores (from 679 to 550 and below) increased by 11.4%.
  • Buyers are getting bigger loans. The average loan amount for a new vehicle went up to $25,995, about $589 higher than the previous year. For a used vehicle, the average went up by $411 to $17,050.
  • Lenders are offering lower monthly payments. Low interest rates, an average of 4.56% to 9.02% for used vehicles combined with longer loan terms are really making loans way more affordable.
These changes have been fueled by the fact that more consumers are paying back their loans as agreed, experts say. According to the report, the number of loan payments that were 30 days late dropped by 7.6% and those 60 days late dropped by 12.1%. In addition, vehicle repossession dropped by 37.1%. When losses are low, lenders are able to do more lending and have better rates.

1. Don't assume your score is too low. There really is no cutoff score below which a buyer automatically won't be able to get approved, one lender might accept a score that another lender would not.  Just remember, the lower your score, the more you can expect to pay. Buyers with the lowest credit scores pay higher interest.

2. If you have a low score, save up. Buyers with lower scores should save up for a bigger down payment, experts say. Making a high down payment is a good idea in general, but is even more important if you have poor credit. A good down payment shows the bank you can be financially responsible and will probably make your car payments on time, greatly increasing your chances of approval. A bigger down payment also means a better rate in most cases, whether you have good credit or bad credit.

3. Shop for a loan before you pick out a car. Speedy Car Loans of Las Vegas and Southern California specializes in shopping for the best possible loan for your credit, working with all of the major banks that the dealerships use. This company first sets your loan in place, then finds a vehicle that fits your needs while making the bank happy. They can approve you over the phone (702 478-2605) and tell you your rate so you'll know where you stand before you even leave your house.

Whether you buy new or used, it's a good idea to keep emotions out of the transaction and look more at the reliability of the car, the cost of the financing and your budget. Remember, you have bad credit, but you won't ALWAYS have bad credit. Use this loan to help repair your fico flaws and you can always trade this vehicle in in a year or so and get something a little more flashy, with a way better rate!