Auto Loans at All-Time High
If you needed an auto loan for your last car purchase, you’re certainly not alone. According to a report by Experian Automotive, an automotive resource that keeps track of financing and purchases, Americans have borrowed a record amount of money in the second quarter of 2015.
Once you see the amount, you’ll understand that auto loans aren’t limited to a specific demographic. Whether you’re a fresh graduate who needs a commuter car, someone who needs to buy a car with bad credit, or just an ordinary guy, there’s no denying that people are now opting for loans more than ever before…
The report estimated that American’s have borrowed $932 billion this year, which is already a $92 billion increase over last year. This total would make for the “largest increase in dollars borrowed for any quarter since 2006,” writes CNBC.com’s Phil LeBeau.
As the writer notes, spring is often the season that experiences the most car sales, and between the stretch of March and June, there were two months that saw car sales top 17 million units. If things continue at the same pace, there will be an average of 17.26 millions vehicles sold each month in 2015. To put things in perspective, the average price of a sold car in July was $31,691, as LeBeau passes along. How much money does that translate to in an entire year? Based on my novice calculations, it’d come in around $6,563,839,920,000!
“The automotive loan market is working the way it’s supposed to, with loans being made, vehicles purchased and payments made on time,” said Experian’s senior director of automotive finance Melinda Zabritski. “The automotive loan market is gaining momentum while maintaining remarkable stability. It’s a good sign for the economy overall.”
While a variety of different folks are eligible for car loans, the Experian reports says “those with subprime or deep subprime credit scores” were responsible for about 20-percent of the money loaned in the second quarter. Those with “super prime credit ratings” were also responsible for 20 percent.
“Overall, lenders are taking a balanced approach to their portfolios, with slight growth in subprime and deep subprime balanced by the uptick in loans to the super-prime risk tier,” Zabritski said. “There really is nothing alarming about the growth seen in subprime loans, provided consumers continue to make timely payments.”
As you can see, there’s no reason to be tentative about acquiring an auto loan. After all, there are clearly a boatload of people who have already borrowed money this year!
If you need an auto loan, regardless of the status of your credit score, check out McCluskey Automotive in Cincinnati, Ohio. The helpful staff will work with you to establish an agreeable payment plan.