Experian Automotive: Twenty-two states show increases in 60-day automotive loan delinquencies; Delaware sees largest spike at 9.9 percent
Schaumburg, Ill., May 22, 2014 — Experian Automotive today announced that while at a national level 60-day automotive loan delinquencies fell 1.7 percent, 22 states showed increases. According to the latest State of the Automotive Finance Market report, Delaware showed the sharpest increase, jumping by nearly 10 percent, up from 0.73 percent in Q1 2013. Other states among the top five for increased 60-day delinquencies include:
• Montana increased by 8.9 percent (up from 0.35 percent in Q1 2013)
• Nebraska increased by 7.9 percent (up from 0.45 percent in Q1 2013)
• Iowa increased by 6.6 percent (up from 0.39 percent in Q1 2013)
• New Jersey increased by 5.8 percent (up from 0.61 percent in Q1 2013)
Thirty-day auto delinquencies dropped 5 percent, going from 2.36 percent in Q1 2013 to 2.24 percent in Q1 2014. Additionally, only six states showed an increase in 30-day delinquencies:
• Alaska increased by 8.9 percent (up from 1.48 percent in Q1 2013)
• Montana increased by 5.4 percent (up from 1.48 percent in Q1 2013)
• Kentucky increased by 3.4 percent (up from 2.27 percent in Q1 2013)
• West Virginia increased by 2.2 percent (up from 2.55 percent in Q1 2013)
• Indiana increased by 1.7 percent (up from 2.06 percent in Q1 2013)
• Pennsylvania increased by 0.9 percent (up from 2.04 percent in Q1 2013)
“Consumers overall are doing a better job of paying their auto loans on time. However, it is evident that consumers in some states still are struggling to meet their payment obligations,” said Melinda Zabritski, Experian’s senior director of automotive credit. “It is important for consumers to keep in mind that paying bills on time is one of the most essential factors when lenders are evaluating who gets the best rates and terms when applying for a future loan. While the subprime auto loan market continued to grow in Q1 and credit-challenged consumers have been able to get financed more easily, a rise in overall delinquencies could cause lenders to tighten their credit standards, ultimately lessening access to credit in the future.”
Other findings from the report showed that repossessions were up 36.5 percent overall in Q1 2014, increasing from 0.50 percent in Q1 2013 to 0.68 percent in Q1 2014. However, the increase was driven entirely by finance companies that provide a significant majority of their loans to credit-challenged customers. In Q1 2014, finance companies’ repossession rates jumped by 69.1 percent, from 1.78 percent in Q1 2013 to 3.01 percent in Q1 2014.
In other findings:
• Total dollar volume for automotive loans was $811.3 billion, the highest since Experian Automotive began publicly tracking loan volumes in 2006
• All lender types experienced growth in year-over-year quarterly loan volume, with banks up by $33 billion, credit unions up by $23 billion, finance companies up by $19 billion and captive finance companies up by $9 billion
• The average charge-off amount for loans gone bad jumped from $7,401 in Q1 2013 to $8,541 in Q1 2014
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Experian Automotive provides information services and market intelligence that enables results-driven professionals to gain the fullest possible understanding of the market, the vehicles and the people who buy them. Its North American Vehicle DatabaseSM houses data on nearly 700 million vehicles and, when combined with Experian’s credit, consumer and business information, provides an integrated perspective into the automotive marketplace. Experian Automotive’s AutoCheck® vehicle history reports provide dealers and consumers with in-depth information, allowing them to confidently understand, compare and select the right vehicles. For more information on Experian Automotive and its suite of services, visit our Website at http://www.experian.com/automotive.
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