Contrary to what most people may believe, nonprime auto loans are not as bad as one thinks. Because of the subprime crisis that caused a global economic meltdown back in 2008, people are already wary of any loans given to risky borrowers (i.e. those who have credit scores below what is considered prime).
Nonprime loans are offered to people who have low credit, yes, but the risk is usually compensated in other ways such as the requirement to put a bigger down payment. The lenders, before they can approve a loan, should first inspect the overall financial profile of the borrower to see if his debt-to-income ratio will not go through the roof and hinder the borrower’s ability to live accordingly while also repaying his or her debts.
Nonprime loans have structure, and although they are considered nonqualified loans, they are still adequately regulated.