CREDIT CRUNCH HITTING THE AUTO LOAN MARKET, TOO

April 25, 2008

CREDIT CRUNCH HITTING THE AUTO LOAN MARKET, TOO

Housing isn't the only market to feel the effects of the current credit crisis -- the auto loan market has been hit too.

As lenders raise their standards for approval, loan seekers are finding it increasingly difficult to secure financing. Those who can obtain loans are settling for lower-priced cars in some cases.

Some of the largest lenders are taking the most extreme measures. JP Morgan Chase now requires larger down payments and is limiting loan length for those with lower credit scores. CitiGroup says it will reduce the number of loans it grants, and has let some 800 workers go in its auto-lending department.

Even higher-credit types are feeling the pinch. "People with decent credit aren't able to get the terms they think they should get," said Michelle Primm, managing partner of the Cascade Auto Group in Cuyahoga Falls.

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