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Auto Loan Access Flat

January’s mixed conditions bring good and bad news for consumers.

February 11, 2025
Auto Loan Access Flat

Loan accessibility improved the most for certified preowned vehicles.

Credit:

Pexels

1 min to read


Auto credit access was mixed in January as some conditions improved for some consumers while others declined.

Cox Automotive’s Dealertrack Credit Availability Index was flat month-over-month at a reading of 95 but up about 3% year-over-year. It said that represents the best access since March 2023 after a December dip.

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Accessibility improved across all channels, especially for certified preowned vehicles, but was mixed among lender types, Cox said.

The market watcher also observed a mix of circumstances that kept the index flat: 

  • A 160 basis-point decline in loan approval rates

  • A 46 basis-point jump in the average auto loan rate for the first rate increase since March of last year

  • A 28 basis-point increase in yield spreads

  • A 100 basis-point increase in the subprime share for the biggest share since April 2024

  • A 50 basis-point increase in loans with terms longer than 72 months

  • A 120-basis point increase in loans with negative equity

Credit access was greater than a year earlier for all channels and lender types and the loosest for noncaptive new-vehicle loans, Cox said. It further explained that banks and captive finance companies’ lending policies have loosened while auto-focused finance companies and credit unions have tightened access.

LEARN MORE: Fed Holds the Line on Rates

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