Bad credit car loans are on the rise

The Internet has become a commonly used tool by the average consumer. While online shopping hasn’t replaced the need for brick and mortar stores, it has created a marketplace where consumers can shop from the comfort of their own homes at a leisurely pace without the need to navigate traffic, search for parking places, deal with crowds, or stand in lines. Because of its seemingly infinite nature, the Internet can provide consumer access to almost any product – including car loans. With a search string such as “car loan with bad credit” anyone can get a return of thousands of results for lenders, loan quotes, loan calculators, auto brokers, and dealerships.

Web searches are conducted by the billions… and that’s no exaggeration. Multiply the millions of computer users searching for answers on a daily, even hourly, basis and the numbers pile up very fast. Picking out the number of searches conducted for “car loans with bad credit” returns numbers in the millions, giving an interesting picture on auto financing trends. These statistics are studied by lending institutions to determine how the car loan market is moving and adjust their sales accordingly. In the early part of 2012, for example, there was a surge in Google searches for “bad credit car loans” which tapered off as the tax season was starting to peak. This would indicate to the car loan market that the population of people who have poor credit is increasing and tapping that market would be a good investment.

Not many people understand how lenders market their product regarding the business of financing as some sort of alien experiment rather than a simple vendor and buyer relationship. In some case, potential borrowers see the lender as nothing more than a legitimized loan shark who hands out money and spends the rest of the relationship shaking down the borrower. This just isn’t true. Even in the case of someone with poor credit trying to obtain a car loan, the lender will only extend credit to someone who it sees as able and willing to pay the loan back. Interest is charged as a matter of doing business and is adjusted based on current national trends in interest rates, and the amount of risk posed by the borrower’s financial situation. Since the lender is selling a product, it must market it in such a way to beat the competition. And, in lending to someone with bad credit, specials and discounts play an integral part of the sales process. Quite often, while extending a car loan to someone with bad credit, a lender is more than willing to bend – but, don’t expect him to break.