Ford is offering special financing rates to buyers with lower credit scores (below 620) to boost F-150 sales before the end of Q3, aiming to make vehicles more affordable despite the higher risk associated with subprime lending. This move aligns with industry trends as automakers like Stellantis and General Motors also provide low-interest deals to attract buyers amid rising vehicle prices and high interest rates.
Surging car prices have led buyers to opt for longer auto loans, such as seven or even eight years, to manage monthly payments, despite the increased total interest paid and potential financial downsides. Shorter loans are now mostly used by wealthier buyers, while leasing remains an alternative. Lenders are also pushing for even longer terms, risking repeat of past financial pitfalls.
Rising car prices have led to the normalization of seven-year auto loans, which are now common but can lead to higher interest costs and financial risks for buyers, as exemplified by a North Carolina couple who paid off their seven-year loan early after realizing the long-term costs.
