A combination of less-generous rate incentives from new vehiclesellers and aggressive rate pricing is accelerating the growth ofnew car loans at credit unions.
|Analysis from CUNA Mutual Group's October Credit Union TrendsReport revealed that those factors contributed to 4.1% annual newvehicle growth as of August.
|A reduced rate of payoffs and less competition from home equity loans have also helped grow creditunions' new vehicle loans, the data showed.
|At $177.6 billion, the industry's total vehicle loan portfoliohas advanced in each of the past seven months and is up $9.5billion or 5.7% year to date, according to CUNA Mutual ChiefEconomist Dave Colby.
|On an annual basis, the $10.6 billion increase translates into a6.4% gain, he added.
|Roughly 48% of all credit union loan growth since August 2011 has been attributable to vehicleloans. Currently, 29.5% of all credit union loans are vehicleloans, up from 28.8% at this time last year, the report noted.
|Used vehicles, which represent 19.1% of all credit union loans,are up 6.0% YTD and 7.6% year-over-year.
|“This is the strongest growth since mid-2004. Reports fromcredit unions indicate loan demand remains brisk,” Colby said.“Mid-year data revisions not only confirmed the vehicle lendinggrowth surge, they added to it.”
|Overall, total vehicle loans were restated almost $1 billionhigher and 0.5% was added to the growth rate, according to thereport.
|Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
- Exclusive discounts on ALM and CU Times events.
- Access to other award-winning ALM websites including Law.com and GlobeSt.com.
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
