Auto Loan Debt Up, Delinquencies Steady
Q2 saw a jump in new borrowing, leases, but no past-due loan growth.
Overall, $188 billion in new auto loans and leases were added to credit reports in the second quarter, up 13% quarter-over-quarter.
Pexels/RDNE Stock Project
U.S. consumers’ automotive loan balances grew by $13 billion in the second quarter to about $1.7 trillion, though serious delinquency rates were about flat.
The Federal Reserve Bank of New York released the data in its Household Debt and Credit Report, basing the findings on its nationally representative Consumer Credit Panel.
The lack of growth in auto loans in arrears is good news, as student loan delinquencies are on the rise and can cause a ripple effect in other finance segments.
Auto loans in serious delinquency, or at least 90 days past due, remained at 2.9% year-over-year, the bank said. Student loans in that category, meanwhile, ballooned from just under 1% to about 13% as past-due payments reported to credit bureaus – suspended from the second quarter of 2020 to the fourth quarter of last year – have resumed.
Overall, $188 billion in new auto loans and leases were added to credit reports in the quarter, up 13% quarter-over-quarter, the bank said. The increase likely includes some of the spring-rush vehicle sales as consumers moved to get ahead of trade tariff-induced price inflation.
Originally posted on Auto Dealer Today
More Industry
Gone to the Dogs
A Stellantis brand decided to have some fun with one of its SUVs’ design to address growing emphasis on family pets.
Read More →
OEM Poll Sees Industry Evolution
Kerrigan Advisors’ survey of automakers finds that tariffs, technology, network tightening and other factors are poised to reshape auto retail.
Read More →
Luxe N.C. Dealerships Change Hands
A collection of Italian and English brand franchises were handed off to the owner’s friend in the business and include the Carolinas’ only Ferrari retail stores.
Read More →
Exposure Drives Interest in Chinese Cars
At a recent demonstration, consumers had the chance to ride in a Chinese-branded vehicle, a firsthand experience that improved their perceptions and purchase intent.
Read More →
Automotive Consumers Sink Further in Debt
Most financing metrics hit records in the second quarter as more buyers locked themselves into long terms and high monthly payments.
Read More →
Agent Advocate
Rob Mancuso, who comes from a long line of auto dealers, values general agents’ place in the industry and makes a case for them taking an even bigger seat at the table.
Read More →
Driving Under Distraction
Though consumers gave higher marks to new vehicles in JD Power’s most recent initial-quality poll, high-tech interference worsened, pointing to craving for simplicity.
Read More →
Affordable New Cars a Thing of the Past
More than one out of five new vehicles sell for more than $60,000, according to Edmunds. That's up 7% compared to prepandemic 2019.
Read More →
State Follows Federal Warning on Auto Ads
The Massachusetts attorney general cautioned the state’s automotive dealers to be upfront with the consuming public about their vehicle prices or risk punishment.
Read More →
Consumer Outlook on the Rise
Younger generations are feeling more positive about their financial futures and current affordability pressures than older generations, according to recent TransUnion data.
Read More →