At first glance, it sounds like great news: more shoppers are getting approved for car loans than at any point in the last decade. But look at how those deals are getting done, and a harder question comes into view. What happens when these customers come back to trade?
Easier credit today can mean harder trades tomorrow.
Dealertrack Credit Availability Index: September 2026 Numbers
Auto credit access improved for a fifth straight month in September, reaching its highest level since April 2015, according to Cox Automotive’s Dealertrack Credit Availability Index. But much of the loosening came through loan structure.
Numbers to know:
Credit Availability Index: up 1.9% to 107.1, and up 9.4% from a year ago
Loans longer than 72 months: up from 26.9% to a record 31.8%
Loans with negative equity: up from 52.4% to 57.8%
Subprime share of loans: up from 15.1% to 17.4%
Average down payment: down from 13.5% to 12.8%, the lowest since September 2022
Meanwhile, the 5-year Treasury yield rose to 4.80%, its highest level since July 2007, while contract rates climbed more slowly. That means lenders are earning less margin while taking on more risk.
How Dealers Can Protect Customers From Negative Equity
Nearly six in 10 financed deals now carry negative equity. That means a customer sitting across from your team has better-than-even odds of owing more than their car is worth.
Lenders are clearly still willing to reach sidelined and lower-credit buyers, and stores are working hard to get them into vehicles. The question is how long the market can sustain these long terms and growing negative equity. If interest rates don’t come down, the next trade cycle could get difficult.
That’s why the most important thing a salesperson can do right now is help the customer make a good decision, even if it means steering them toward a different vehicle, a bigger down payment, or a shorter term. Beaver Toyota GM Patrick Abad made the same point on Tuesday’s show.
Dealers who helped customers make smart choices years ago are reaping the benefits today. Their customers are coming back without negative equity, which makes the next deal far easier. Consultative selling isn’t just good ethics. It’s the best long-term retention strategy a store has.
The deal you structure today decides whether that customer can come back tomorrow.
We dig into the credit data on today’s episode of the Automotive State of the Union.
