Auto Loan Delinquency Rate at New Low: TransUnion
For the second consecutive quarter, the national auto loan delinquency rate hit its lowest level since TransUnion began tracking the data in 1999.
The firm tracked the ratio of borrowers 60 or more days past due. Auto loan delinquency rates in the second quarter dropped to 0.33%, down from 0.36% in the first quarter.
On a year over year basis, auto loan delinquencies declined 25% from 0.44% in the second quarter of 2011, according to TransUnion.
In addition to increased demand in new and used autos, auto debt per borrower has risen nearly 6% from $12,689 in Q2 2011 to $13,427 in Q2 2012, TransUnion said.
Despite growing auto debt, the majority of states and cities are experiencing declines in their auto loan delinquency rates. Between Q1 2012 and Q2 2012, 37 states experienced declines in their auto delinquency rates.
A recent TransUnion study found that consumers now value their auto loans more than their credit cards and mortgages, said Peter Turek, automotive vice president in TransUnion's financial services business unit.
“This is partly due to the need for transportation to get to work or to seek employment in a difficult job market,” Turek said. “Additionally, consumers with car loans have more equity in their vehicle than they have in the recent past because of the strong used car vehicle market. Consumers want to keep their auto loan relationships in good standing.”