The lion's share of financing for used cars has continued to be banks and credit unions through the third quarter of 2021, according to Experian.
In the latest State of the Automotive Finance Market report, Experian shows banks holding steady as the leaders in financing for used cars, with 35.35% of the market share, up almost three points from Q3 2020. Credit unions come in with the second most used cars financed – they've consistently funded around 25% of the used car loans year-over-year for the last three years.
Banks have long dominated the auto finance market, and with current interest rates holding at lower numbers than pre-pandemic levels, it's no wonder borrowers are flocking to banks to find the lowest rates possible.
Not every borrower qualifies for a loan from their bank or credit union though, and other financing fills this gap, accounting for 15.46% of the financing, while independent finance companies make up 15.21% of the market. Captives continue to hold the lowest share of used vehicle financing, with only 8.52% of used car loan originations.
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