Finance companies & captives rushing getting into growing & profitable U.S. subprime auto loan market.
Smaller lenders access funding with low cost interest rates and investor backing of portfolios.
What This Means for F& I Departments:
- New lenders have entered subprime auto loan market
- Companies like Skopus & Pelican Auto + Ally & Santander Consumer USA
- Wall Street backing has heightened loan company competition
- Subprime auto loans have “moved up the food chain” for investors
- Asset-based securities have increased 18% to $21.5B in 2013
- As demand for loans increase, Moodys puts out warnings about portfolios
- Experian says that nonprime & subprime market share is now 34.1%