Hyundai Moves to Increase Auto Loans

February 23, 2009

One of the current trends of the economic hardship has been that the auto industry has undergone a number of setbacks, and in many cases became outright threatened by the possibility of bankruptcy. To say that the worldwide auto industry is in questionable shape is a definite understatement. This situation, however, does offer one significant silver lining, which is that car loans can be procured at the moment with relative ease, with all time record low interest rates and favorable terms. This is especially true for buyers looking to purchase vehicles that utilize energy-saving hybrid technology, as the federal government is increasingly willing to put their efforts behind alternative fuel sources (often in the form of tax incentives).

It should come as no real surprise then, that Hyundai has recently chosen to extend this practice. One of the largest automakers in all of the East, Hyundai recently announced that they were brokering a deal with the public sector bank, Syndicate Bank, in order to increase sales.

The specifics of the deal are of course shady as of yet, but the general idea is that Hyundai will be drawing on a loan in order to gain even more flexibility in the terms that they can offer buyers using financing. This means that the trend of “good deals” in auto financing is likely to continue for the time being, and that Hyundai models in particular may well enjoy even greater savings.

Unfortunately, every silver lining does have a cloud attached and consumers should be aware that Hyundai has also stated plans to increase prices by as much as 2 percent.

Overall, however, Syndicate Bank officials are confident that the move will enable drivers to enjoy excellent savings on auto loans, as it will provide them the means to secure deals at a reduced interest rate of just 12 percent instead of the customary 12.5 percent that has been common for more than a year now. In addition to that, Hyundai is offering customers a rebate for the majority of the “processing charge” attached with financing a vehicle, meaning that nearly one full percent of the loan is reimbursed immediately upon signing.

Moves such as this one are always big news for the auto industry and right now is no exception. Those who suffer from bad credit have often lamented the hardship in acquiring a car loan, and so this unique economic climate offers a compelling opportunity for them. While one should not rush into any agreements that they cannot afford to honor, it is conventional wisdom that paying on time on a monthly contract such as a car loan is one of the best ways to re-establish credit after it has been damaged.

With car loans being given out with increasing laxity, even the most suffering of borrowers may well have such an opportunity in their laps soon. This is especially true because of a number of recent announcements that the money-saving financing opportunities may well soon be extended to used cars as well as new ones. If you’re looking for a good way to rebuild your own credit score and are in need of a new ride, keep an eye on this trend.