Auto Loan Delinquencies Rise in Recent Quarter
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UPDATED: Feb 25, 2013
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Sixty-day auto loan delinquencies increased in the fourth quarter of 2012, according to a recent Experian report.
The Experian Automotive report provides quarterly trend analysis results for auto loans and delinquencies.
Sixty-day delinquencies rose from 0.72 percent in Q4 2011 to 0.74 percent in Q4 2012. The increase was the first year-over-year rise for either 30- or 60-day auto loan delinquencies since Q4 2009.
In contrast, 30-day delinquencies reduced slightly. The 30-day delinquencies declined from 2.79 percent in Q4 2011 to 2.72 percent in Q4 2012.
For credit union, captives and banks, 30-day delinquencies dropped. On the other hand, finance companies saw a large rise from 5.35 percent in Q4 2011 to 5.61 percent in Q4 2012.
The balance on 60-day delinquent auto loans increased from a total of $3.48 billion in Q4 2011 to $3.93 billion in Q4 2012. Although the financial increase was significant, the growth as a percentage of the overall market was small, and increased only from 0.53 percent in Q4 2011 to 0.55 percent in Q4 2012.
Compared with the lending market three years ago in Q4 2009, Experian said the current market is more stable.
“Overall, our Q4 analysis shows that the auto lending market is extremely healthy,” said Melinda Zabritski, director of automotive credit for Experian Automotive.
Sixty-day auto loan delinquencies reduced from 0.94 in Q4 2009 to 0.74 percent in Q4 2012. In the same quarters, the 30-day delinquencies reduced from 3.30 to 2.72 percent.
Despite the increase in delinquencies, Experian said the auto loan market is retaining its stability.
“You never want to see an increase in delinquencies, but when you take a step back and look at the market compared to where it was three years ago, we still have remarkable stability,” Zabritski said.