Auto loan balances jumped more than 11 percent during the third quarter compared with last year. Find out why the trend is significant.
Auto loan balances topped the $1 trillion milestone during the past quarter, according to credit reporting agency TransUnion.
Balances reached $1.008 trillion, TransUnion says in its latest Industry Insights Report, a quarterly overview of U.S. consumer lending. That’s an increase of $101 billion, or 11.1 percent, from the third quarter of 2014.
Jason Laky, senior vice president and automotive business leader for TransUnion, says in a news release that this increase in auto debt can be partly attributed to consumer confidence:
“As total auto loan balance rises, we’re seeing controlled and deliberate growth by lenders. Consumers continue to feel confident in their employment or job prospects, and their appetite for new auto loans reflects this confidence.”
More consumers also had access to auto loans as of the third quarter of this year, with 2 million additional consumers having access compared with the second quarter of this year.
Other findings from TransUnion’s report include:
- The average balance across all auto loan accounts was $14,515 as of the third quarter, an increase of 2.7 percent from the third quarter of 2014 — and the slowest pace of average balance growth since the fourth quarter of 2011.
- Nearly 75 million consumers had an open auto account as of the third quarter, an increase of 5 million people from the third quarter of 2014.
- Although auto loan balances have increased, auto loan delinquencies (the rate of borrowers 60 days or more delinquent on their auto loans) have remained flat. That rate was 1.16 percent in the past quarter — the same as it was during the third quarter of 2014.
Do you have an auto loan? Share your thoughts about the process below or on our Facebook page.