The total number of auto loans originated in January 2011 is up nearly 24% over January 2010 originations, according to Equifax’s National Credit Trends Report for March 2011.
Borrowers with Equifax Risk Scores of 640 or above represented nearly 84% of all new auto loans sourced through banks, credit unions and savings and loans in January 2011, the data showed. This same group represented nearly 65% of all loans sourced through auto finance companies.
The industry also continues to see a decline in write-offs with January to March 2011 auto loan write-offs at a five-year low at $5.5 billion, Equifax reported. This represents a decrease of 35% from January to March 2010 levels.
“The number of new auto loans represents the largest increase among tracked lending sectors within the Equifax Credit Trends Report,” said Michael Koukounas, senior vice president, special client services for Equifax. “The data also reflects declines in write-offs, with delinquencies falling to 2007 levels following their peak in 2009. This, paired with increasing originations, underlies the beginning of auto portfolio growth.”
Equifax’s National Credit Trends Report is released monthly and provides analysis of consumer credit information from various vertical markets, including bank and retail credit cards and mortgage, automotive and student loans, sourced from the company’s data on more than 585 million consumers and 81 million businesses worldwide.