June 23, 2021

Auto financing flex

first_img 12SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr Consumers are increasingly looking for greater flexibility in financing their vehicles. As an example, some like residual financing, such as the balloon lending program credit unions can offer as an alternative to traditional leasing or loan programs through Auto Financial Group. This program reduces consumers’ monthly payments by letting them pay off just a part of the principal during the term of the financing. When all the payments are made, the borrower pays the lender a lump sum or “balloon payment” for the difference.According to Experian Automotive, all types of leasing, including residual-based financing, have grown from 24 percent to 31 percent over the last five years.This is not surprising when you consider that Experian Automotive also finds the average auto loan amount has increased 16 percent since 2011. In 2011 the average was $25,873, while today the average loan amount has increased to $30,032. Some consumers are unable or unwilling to purchase a new vehicle and are looking to financial institutions for financing options.In all of this, used cars, including certified pre-owned vehicles, have become an attractive option for consumers looking to lower their monthly payments and shorten their terms. According to a recent survey by Swapalease.com, an online car lease marketplace, 78 percent of drivers said they would consider using lease options, including residual-based financing, for their purchase of a used car or truck. continue reading »last_img

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