Did you know that a record 29 million auto loans and leases were originated in 2016?
29 Million Auto Loans & Leases
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Tag Archives: Subprime Auto Loans
Auto Loans Hit Q1 Record
Worries that auto lenders were again back to their old ways of writing risky loans may prove to be unfounded. The percentage of subprime loans is now falling.
Subprime or deep subprime loans made up 19.7% of the market in the first quarter, the lowest percentage since 2012, EA reports.
Yet with employment strong across the country and new cars costing more, auto loans are reaching record levels. They hit $905 billion in the first quarter, up 11.3% from a year ago.
In addition, the number of borrowers who fell 30 days behind in their payments fell 4.1% from a year ago. Those behind 60 days went down 3.2%.
“The current stability in the automotive loan market is a testament to consumers making timely payments on outstanding loans, which is evident in the improvement in delinquency rates,” says Melinda Zabritski, senior director of automotive finance.
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Subprime loans fall
Subprime and deep subprime auto loans in the first quarter dropped to their lowest share of the market since 2012, Automotive Data Experts said this week.
Together, subprime and deep subprime loans made up 19.7 percent of the market, compared with their 19.6 percent slice three years earlier, according to the source’s first-quarter State of the Automotive Finance Market report.
The Data Source defines the subprime risk category as credit scores of 501 through 600 and the deep subprime category as scores of 300 through 500.
“Over the last year, there has been a tremendous amount of conversation around the growth in subprime loans, and the concern over the automotive finance industry approaching a potential ‘bubble,’” the senior director of automotive finance, said in a statement on Monday.
Subprime Auto Lending Infographic
Data used from an article published by CNN Money. Click here to read the complete article.