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Fewer Car Buyers Late on Loans

by on May.31, 2011

Lenders lossen credit, but delinquencies and defaults still decline, reports TransUnion.

Whether it’s a sign of an improved economy may be unclear, but the number of consumers late in paying their car loans has fallen to the lowest level since 1999, and is nearing an all-time low.

The number of car buyers 60 days or more behind in their payments has plunged to just 0.49%, or less than one in 200, nearing the lowest figure ever recorded by credit reporting agency TransUnion.  By comparison, the figure stood at 0.66% during the first quarter of 2010.

Meanwhile, the number of auto loans started during the first quarter of 2011 increased by 22%, tracking with the overall increase in U.S. new car sales this year.

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The agency reported that the highest number of auto delinquencies for the quarter were in Mississippi, Louisiana and Oklahoma, while the lowest were found in Montana, Washington, D.C. and Wyoming.

Low interest rates – often subsidized by manufacturers hoping to spur demand may be a factor in current loan trends.  Other factors TransUnion cited include a stronger automotive market and higher consumer confidence.