Analytic data from Experian Automotive covering the June ending quarter of calendar 2013 revealed this week that a record number of Americans used an auto loan or lease when purchasing a new automobile during the aforementioned frame.
Analytic data from Experian Automotive covering the June ending quarter of calendar 2013 revealed this week that a record number of Americans used an auto loan or lease when purchasing a new automobile during the aforementioned frame. 84.5 percent of American consumers, to be exact, purchased a new vehicle by means of auto financing, may it be a loan or a lease. This represents the highest share of auto loan use since Experian first recorded the metric in 2006.
As of the June 2012 ending quarter, 82.5 percent of consumers used a loan or a lease, while this statistic was at 79.7 percent in 2008, just before the worldwide economic crisis.
Experian Automotive’s analytics also indicate that interest rates have been down for new and used automobiles alike, which has prompted consumers to seek out lenders more often than before. Average interest rates on new car loans were down to 4.46 percent from 4.63 percent in the June 2012 quarter, while used car loan rates declined 39 basis points year-over-year , from 8.95 percent in the June 2012 frame to 8.56 percent in Q2 2013.
According to Experian Automotive senior director of automotive credit Melinda Zabritski, the statistics represent “good news” for the automotive space, “but it’s also good for consumers because this, combined with the reduction we have seen in delinquencies, shows that they are feeling more confident in their ability to take on more debt and pay it off in a timely manner.”
One variable that has traditionally helped consumers qualify for low rates on automobile loans has been credit scores – in the June quarter, consumers needed an average credit score of 660 to qualify for a used car loan, while the average rate was 8.56 percent. For new car loans, on the other hand, consumers need a credit score of 749 on average to qualify for an average 4.46 percent interest rate.
It is still most advisable for one to check his credit report for manifold reasons, primarily to make sure all of one’s “ducks are in a row” before shopping for a new automobile.