Recovery? Auto Loans Up, Delinquencies Down
New data indicates the amount of automotive debt households are carrying has risen, but in a positive light, delinquencies are down. According to a recent report in the Detroit News, the average automotive balance has risen to $13,435, an increase of 4.5 percent year-over-year. But despite that increase, the higher debt hasn't resulted in an increase of missed payments. "It's encouraging to see consumers take on more auto debt while delinquencies remain low," said Peter Turek, TransUnion's vice president of automotive. The auto market has been strengthening in the past year, with most automakers experiencing sales increases, many of which are new records. July saw a 14 percent increase, helped by low interest rates and good lease terms. Lenders are also increasing the amount of loans given, extending credit to those with less than perfect credit ratings. In the first three months of this year the delinquency rate fell slightly, and has remained essentially flat the past few months. Amid mixed financial news, the auto industry has generally been a bright spot of late. Source: Detroit News
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