The number of consumers taking out loans for a new or used car has increased over the past decade and will likely continue to grow in 2013. Delinquency rates on auto loans are at an all time low meaning that although consumers are taking out higher loans they are repaying them in a timely manner.
On average the percentage of loans past due more than 60 days during 2012 is about 0.35 percent; fourth quarter numbers are still unaccounted for but that number is expected to be as low as 0.36 percent.
Transunion numbers are also indicating that over 20 million auto loan borrowers have a Vantage score under 700.
“It’s a real sign that the automobile market is on solid footing that even with more non-prime consumers carrying auto loan balances, we’ve continued to maintain a low national auto loan delinquency rate,” Peter Turek, of TransUnion®’s financial services business unit, told The Huffington Post.
The amount borrower’s need has also been on an upward trend which could indicate that more people are looking to buy new rather than used cars. What consumers can take away from this is that as those with lower credit scores continue getting approved for auto loans, they can expect rates to continue to lower as competition amongst lenders rises.