Banks, bolstered by loose monetary policy, are charging U.S. consumers the lowest interest rates on new-car loans since the Federal Reserve began surveying them in 1971.
What does that translate into, when it comes to dealer sales?
Attractive rates helped spur a 9.5 percent jump in light-vehicle sales last month and maintained the fastest pace since the U.S. government’s “cash for clunkers” program three years ago, according to analysts surveyed by Bloomberg.
More than one in 10 auto loans written in August featured a zero percent interest rate, the highest level of the year, according Edmunds. The average interest rate on auto loans fell to 4.1 percent in August, the lowest of the year.
“We’re starting to see folks with lower credit scores come back and they have a higher tendency to take extended loan terms,” J.D. Power’s [Thomas] King said in a telephone interview.
Find out what the experts have to say about lower interest rates.