The average loan amount for new vehicles in the first quarter rose 3 percent to $31,455 — a $921 change from the year earlier. Photo credit: DAVID PHILLIPS
The average loan amount and monthly payment for new vehicles reached record highs in the first quarter, Experian said Thursday in its State of the Automotive Finance Market report. Meanwhile, the percentage of new-vehicle subprime loan originations dropped, while prime origination share reached a six-year high.
The average loan amount for new vehicles in the first quarter rose 3 percent to $31,455 — a $921 change from the year earlier. The average monthly payment for a new-vehicle loan increased 3 percent — or $15 — to $523.
As consumers’ credit scores improved, the percentage of new-vehicle loans to subprime customers fell 8.4 percent. For deep subprime customers, it dipped 14.1 percent, according to the report.
Partially driven by dwindling subprime share, 73.4 percent of new-vehicle loan originations were in the prime or super prime category in the quarter, the highest level since the first quarter of 2012 and a sign that some lenders have become more risk-averse, said Melinda Zabritski, Experian’s senior director of automotive finance.
The average new-vehicle loan term grew to 69 months, compared with 68.5 months the year earlier.
New-vehicle loan originations with terms of 61 to 72 months increased to 41.3 percent, while originations between 73 to 84 months declined to 33.6 percent.
Read more >