Auto Credit Access Hit 2-Year High

Auto credit access in the U.S. has improved sharply, hitting its highest level in about two years in December 2025, mainly because lenders are approving more loans and offering slightly better pricing.​

What “2‑year high” means

• Cox Automotive’s Dealertrack Credit Availability Index for auto loans rose to 99.6 in December 2025, its best reading since October 2022 and close to the 2019 baseline of 100.​

• This indicates that, compared with the past two years, it is generally easier and somewhat cheaper for qualified consumers to get car finance.​

Key drivers

• Higher approvals: The auto loan approval rate reached about 73.7% in December, up 0.9 percentage point from November and 0.8 point from December 2024.​

• Better pricing: The average contract rate dipped slightly (around 10.5% to 10.3%), and the yield spread narrowed, meaning lenders are accepting a bit less margin so monthly payments are modestly lower than earlier in 2025.​

Risk and subprime lending

• The share of loans going to subprime borrowers fell slightly month over month (from 14.3% to 14.1%) but is still more than 2 percentage points higher than a year earlier, showing more willingness to lend to higher‑risk borrowers than in 2024.​

• Lenders remain somewhat cautious: subprime share is no longer surging month to month, and there are signs of tighter standards at the very lowest credit tiers in broader credit data.​

Channel and lender differences

• Credit access improved most for used‑vehicle channels, especially independent used dealers, with smaller gains for new and franchised used, while certified pre‑owned was the only segment that saw a small decline.​

• Captive finance arms (linked to manufacturers) led the loosening, followed by banks and specialized auto finance companies, with credit unions easing but more cautiously.​

What this means if you’re shopping

• Qualified buyers are more likely to get approved and may see slightly lower rates or more flexible terms (like longer loan durations or lower down payments) than earlier in 2025.​

• Consumers with weaker credit still face scrutiny, but conditions are notably better than a year ago; shopping multiple lenders (banks, captives, and online finance companies) can help secure the most favorable offer.​