Auto credit access tightened for the second month in a row for a cumulative 1.7% drop in Cox Automotive’s All-Loans Index, though loans through independent used-vehicle dealers loosened in December.

Despite U.S. interest rate increases ending, Cox said yield spreads widened and term length and negative-equity share fell in December, narrowing consumer credit access. The down-payment share was flat but still the highest in the index’s history.

Still, the approval rate and subprime share rose for the month, creating some balance.

Credit access fell across all lender types, and all channels tightened year-over-year. All but used-vehicle loans via independent dealers and auto finance companies were tighter than before the onset of the pandemic. Certified preowned loans tightened the most of any category.

Consumer confidence in general, meanwhile, rose significantly in December, Cox pointed out. The Conference Board of Consumer Confidence Index increased about 10% on brighter expectations for both the present and future, and a University of Michigan sentiment index rose about 14%.  

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