Monday, June 9, 2014

Auto Credit Reaches Record High

According to the latest Equifax National Consumer Credit Trends Report, the automotive lending sector continues its strong performance in 2014.

Total outstanding balances reached $884 billion in April, a record high and an increase of 10.8 percent from the same time a year ago.

New credit was $69.6 billion year-to-date in February, an eight-year high and an increase of more than 13 percent from the same time a year ago.

Serious delinquencies represent less than 1 percent of total outstanding balances, the lowest level in more than five years.

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Auto Terms Reach 66 Months

Experian Automotive announced that loan terms continued to lengthen, with the average automotive loan term reaching 66 months for the first time.

According to Experian Automotive’s latest State of the Automotive Finance Market report, loan terms in the first quarter of 2014 reached the highest level since the company began publicly reporting the data in 2006. The analysis also shows that loans with terms extending out 73–84 months made up 24.9 percent of all new vehicle loans originated during the quarter, growing 27.6 percent since the first quarter of 2013.

The average amount financed for a new vehicle loan also reached an all-time high of $27,612 in the first quarter, up $964 from the previous year. In addition, the average monthly payment for a new vehicle loan reached its highest point on record at $474 in the first quarter, up from $459 in the first quarter of 2013.

Consumers also continued to lease new vehicles at record levels. Of all new vehicles financed, 30.2 percent were leased in the first quarter, compared to 27.5 percent in the first quarter of 2013.

Of all new vehicles sold (whether financed or purchased in cash), a staggering one in four, or 25.6 percent, were leased in the first quarter 2014, compared to 22.9 percent in the first quarter of 2013.

Overall, loans and leases for new vehicles were easier to obtain in the first quarter. For new vehicle loans, the average credit score was 714, down from 722 in the first quarter of 2013. For leases, the average credit score was 721 in the first quarter, compared to 731 in the first quarter of 2013.

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As always - We want your questions, so please feel free to ask us anything because the team at CARS really cares about your success and we're committed to you by not only getting results, but to make learning fun and exciting. You can email us at repocarsinmichigan@gmail.com

"Make Money & Have Fun" - Jason Pries (follow on Twitter)

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