Looking at the Ways Consumers Can Benefit from Indirect Lending

Posted by Gale Freeman on September 29th, 2022

Life seems to be getting more expensive these days. Reports show that the costs of everything from housing to medical care have surged over just the last 20 years alone with some prices now hovering at more than 200 percent over those of two decades ago. Because of that, the need for loans has grown as well.

Several companies are offering loans at this point. Banks and credit unions are among the solutions many consumers turn to when they need to borrow money for certain expenses, like purchasing vehicles. Those options aren't available to everyone, though, so indirect lenders like Consumer Portfolio Services step in to bridge the gap.

Looking at the Benefits Indirect Lenders Can Offer

Indirect lenders have become go-to options for quite a few people. They can offer an array of benefits when compared to some other solutions. For one, they're driven to help people acquire financing because their reputations and bottom lines depend on it. That's only part of the picture, though.

Serving a Broader Range of People

Another benefit of indirect lenders is their ability, or willingness as the case may be, to serve more people than conventional lenders. They have less stringent eligibility requirements. As such, they can help people who have bad credit or no credit at all.

More Affordable Rates

Indirect lenders can also offer more affordable rates on loans than other institutions. Many lenders see loan applicants with bad credit or no established borrowing histories as high-risk prospects. They raise their rates for those applicants to help mitigate those risks. Indirect lenders don't necessarily calculate their rates in the same way as their conventional counterparts, so their loans are often more affordable for consumers.

Faster Approvals

In some cases, indirect lenders can provide faster loan approvals than other institutions. That helps consumers get the auto loans they need more quickly, so they don't have to wait as long to purchase vehicles. That's certainly an advantage for those who can't wait for weeks or months to buy a car. It's a benefit for dealerships that need to keep their inventory moving, too.

Stepping Outside the Box

Although banks and credit unions are options for some borrowers, they're not the right options for others. Those with bad credit or other roadblocks standing in their way may not be eligible for loans from those sources. Companies like Consumer Portfolio Services can provide loans to prospects who are otherwise unable to acquire financing. They tend to offer lower rates and faster approvals to boot.