Report: Auto Lending Outlook Positive for 2014
Auto finance trends will remain positive in 2014, including easier access to credit for consumers, more leasing and bigger loans, credit bureau TransUnion says.
Automotive News reported that the company said it expects the average automotive debt per borrower to increase about $1,000 next year, from an estimated $16,942 in the fourth quarter this year to 17,966 in the 2014 quarter.
“Unless there is a real shock to the economy, we don’t envision auto loan debt levels to drop for quite some time,” Peter Turek, TransUnion’s vice president of automotive, said in a statement. “This is good news for dealers, lenders and consumers, as higher demand for autos will lead to more auto loans, creating incentives for consumers, as auto dealers and auto lenders compete for their business.”
One downside for 2014 is an expected increase in delinquencies as subprime loans continue to increase, TransUnion said.
The credit bureau expects the percentage of auto loans past due 60 or more days to increase to about 1.19% in the fourth quarter of 2014, from a projected 1.1% in the fourth quarter this year. To put that in context, the fourth-quarter average from 2007 to 2012 was 1.32%, TransUnion said.
“While we expect auto loan delinquencies to rise in 2014, they will remain well below levels observed during the recession and its immediate aftermath,” Turek said.
To read the entire article click here.