According to a recent Bloomberg report, today's interest rates that are currently hovering at historically low rates have helped push a 9.5 percent jump in new car sales across the U.S. and have helped car
ealers to maintain the fastest paced sales climate since the government's cash for clunkers program pushed up new car sales three years ago. In addition to the super low interest rates banks are charging on new car loans, the fact that the major brands including Toyota, General Motors, Ford, Chrysler, and Nissan are all offering zero percent interest financing on some models of new cars and light trucks has also helped drive many new car sales as well.A side effect of the low interest rate climate in the U.S. today is that even those buyers with less than perfect credit histories and low credit scores are benefiting from the widespread availability of more-affordable loans too. This fact is evidenced by the fact that new car sales to buyers with second tier credit scores of 650 to 679 have risen a full 26 percent this year alone. In contrast, new car sales to buyers with near perfect credit histories and excellent credit scores of 790 to 999 rose only 7 percent during the same period.
The availability and affordability of low interest rate auto financing has helped the auto industry survive in a weakened economy and improve much faster than the speed at which home mortgage rates are falling, and also explains why auto dealerships are faring better and beating back the recession much faster than the still challenged housing market has been able to achieve. Across the board, Bloomberg's surveys now show that most American bank's average rate for a 48-month new car loan was 4.87 percent in the most recent reporting period. Total deliveries of new cars up to August of this year rose by 15 percent to 9.7 million vehicles and it looks like the combined auto industry will exceed 14 million sales this year, representing the best overall sales total since 2007. The fact that the reported new car sales from Toyota alone were up a staggering 36 percent in September alone show just how strong the market is.
The combination of low interest rates and the availability of so many loans at zero interest translate to a climate of competition for buyers among the different brands of autos. If you are in the market for a new car this year, it looks like now may be the best time for people at every level of credit to buy a brand new car or truck with the best loan terms in years.