Autoloans can be taken from a variety of lending institutions. Banks make up the largest share, accounting for approximately 18.7% of the auto loan market. Captive finance companies also make autoloans for people with good credit. In addition to banks, Captive finance companies also make autoloans. The following is a guide to both types of autoloans. Listed below are some of the main types of auto loans.
Credit unions make up 18.7% of the auto loan market
Although COVID-19 and other supply-chain constraints have made car-buying more difficult in recent years, consumer confidence continues to rise, contributing to increased demand for vehicle financing. Credit unions have grown their share of the auto loan market year-to-date, and they closed the first quarter with over 18.7% of the market. This is a record high for the industry, and it reflects the continued strength of credit unions in the auto market compared to their performance in other loan categories.
Banks account for largest share
Consumer banks are extending more auto loans, and many are expanding their reach even more. In fact, banks account for almost half of all car loans in the United States. But despite their dominance in the market, banks are still less eager to give out loans to consumers than captive lenders, who make up 30.2% of the industry. Here’s a breakdown of the auto loan market by bank.
Captive finance companies make autoloans for customers with excellent credit
The benefits of a captive finance company making autoloans for customers with good credit are numerous. They can offer lower interest rates and longer loan terms than traditional lenders, and they can even extend credit to people with less-than-perfect credit. In addition, the captive finance company can control the loan and the purchase in one convenient transaction. In addition, they may offer cash rebates or other incentives, too.
Direct and indirect autoloans
There are two types of auto loans – direct and indirect. Direct loans are obtained directly from a lending institution, while indirect loans are obtained through an intermediary. The latter type of loan is generally more expensive than direct loans, but can be a good option for borrowers who do not qualify for a direct loan. However, you should be aware of the risks associated with indirect loans. You should also consider the costs associated with getting an indirect loan before you decide which type of auto loan to apply for.