Consumers continue to use longer-term loans to reduce the costs of monthly payments when they purchase a new vehicle with almost one third opting for loans of between six and seven years, according to new data from Experian, the credit monitoring service.
Experian, in its latest report on the State of Automotive Finance Market, also found the average loan amount for a new vehicle reached a record high of $30,621 in the fourth quarter 2016. The average loan amount for a used vehicle also reached record levels, jumping from $18,850 in fourth quarter 2015 to $19,329 in in the fourth quarter of 2016.
Total open automotive loan balances reached a record high $1.072 trillion in the fourth quarter of 2016, up from $987 billion the same period in 2015 but the growth in loan balances has slowed, the report said. (more…)