Auto loan balances topped $1 trillion, according to Experian Automotive data released yesterday. The market first reached the trillion dollar mark in 3Q15, but this marks the first time the market has surpassed the previous record.
To be exact, loan balances came to $1.005 trillion in 1Q, up from $905 billion the same time a year prior, according to the most recent State of the Automotive Finance Market report. Leasing also grew to an all-time high of $76.9 billion, up from $73.1 billion — or 27.55% — from the same time a year prior.
“Automotive financing certainly has started off the year with a bang, seeing steady growth in balances and loan volumes throughout the first quarter,” Melinda Zabritski, senior director of automotive finance for Experian, said in a press release. “With more and more consumers relying on financing, it is important for lenders to keep a close eye on delinquency trends to ensure the market remains healthy. Likewise, consumers need to continue making their monthly payments on time to keep affordable financing options open and available.”
Delinquencies 30-days past due were at 2.1%, up from 2.02% in 1Q15, while delinquencies 60-days past due were up to 0.61, from 0.57% at the same time a year prior. Experian noted that although both 30- and 60-day delinquency rates were up, the overall percentage of total delinquent loans remains relatively low when compared to pre-recession levels.
The report also found that non-bank finance companies and credit unions saw the largest growth in loan and lease market share, posting a 25.6% and 15.9% growth respectively, however banks continued to hold the top position in volume at $349 billion in market share, according to the report.
