Car loans tightening up in rough economy

Gas prices have certainly made it tougher to find the money to buy a car, but there’s another factor at play now too.

The financial meltdown of some top banks has caused the credit market to get much tighter, making car loans harder to come by these days.

It’s going from bad to worse in the car business; high gas prices kept people off the lots earlier in the year, and now as the cost at the pump moderates, for some it’s the credit crisis making it very tough to get a car loan.

The rates really haven’t changed that much, but lenders are looking deeper at our credit history. The credit score used to be enough, but now they’re looking at things like your time at your last two jobs, or time living at your last couple residences.

“You have to be very careful, because if you go from dealership to dealership to dealership and just keep trying to find someone who will get you bought and all these banks see that no one’s buying you, you’re going to have a hard time getting bought,” says Kris Tucci of Americar.

Just five years ago, Tucci says maybe up to four out of 10 people that came in with bad credit he’d have to turn away; now that number is up to almost 7 out of 10.

And it may be some time before banks reach too far out with their loans.

Consumer Credit Counseling tells us car repossessions are at a 10-year high.