Automotive Digital Marketing

Professional Community for Car Dealers, Marketing, Advertising and Sales Leaders

Loading... Be Patient!

Latest Equifax Auto Credit Trends Illustrate Softening Loan Balances

Here are the latest auto credit trends as reported by Equifax through March 2019:

 

  • Equifax is reporting data that show the increase in loan balances on both financed and leased vehicles may beginning to slow.
  • Balances on loans in the period ending January 2019 showed an increase of 2.8% from the year earlier, this number shrunk to just 1.3% in the period ending March 2019.
  • Balances on leases in the period ending January 2019 showed an increase of 3.0% from the year earlier, this number shrunk to just 0.5% in the period ending March 2019.

 

Auto Loan Originations Observations

Originations through March 2019 reported as of May 2019:

 

5.90 million auto loans, totaling $135.5 billion, have been originated year-to-date. This is a 1.0% decrease in accounts and a 1.3% increase in balances over this time last year.

 

Auto loans represent 86.6% of all auto account originations and 89.8% of auto origination balances YTD.

 

1.39 million auto loans have been originated YTD to consumers with a VantageScore® 3.0 credit score below 620. These are generally considered subprime accounts. This is a 1.0% decrease from March 2018. These newly issued loans have a corresponding total balance of $25.5 billion, a 2.4% increase year-over-year.

 

Through March, 23.5% of auto loans were issued to consumers with a subprime credit score, and they accounted for 18.8% of origination balances. In 2018 YTD

the account share was 23.5% and balance share was 18.6%.

 

The average origination loan amount for all auto loans issued in March 2019 was $23,182. This is a 3.1% increase over March 2018. The average subprime loan amount was $18,552. This is a 3.6% increase compared to March 2018.

 

Auto Lease Originations Observations

Originations through March 2019 reported as of May 2019:

 

914.3 thousand auto leases, totaling $15.4 billion, have been originated year-to-date. This is a 3.1% decrease in accounts and a 0.5% increase in balances, from this time last year. Auto leases accounted for 13.4% of all auto accounts originated through March, and 10.2% of balances.

 

85,660 auto leases have been originated YTD to consumers with a VantageScore® 3.0 credit score below 620. These are generally considered subprime accounts. This is a 5.4% decrease from March 2018. These newly issued leases have a corresponding total balance of $1.53 billion, a 1.6% decrease year-over-year.

 

Through March, 9.4% of auto lease accounts and 9.9% of total balances were issued to consumers with a subprime credit score.

 

The average origination balance for all auto leases issued in March 2019 was $16,710. This is a 2.7% increase from March 2018. The average subprime lease amount was $17,712, a 2.9% increase over a year ago. Note that lease origination values reflect the contract amounts only and exclude expected vehicle residual values.

 

"We're certainly keeping a close eye on credit trends as they relate to originations and balances for both financed and lease environments as we move through 2019," said Jennifer Reid, Equifax’s vice president of Automotive Marketing and Strategy. "The lower percentage increase in balances for loans and leases at the end of March indicates that dealers and lenders continue to need advanced data to help them stay ahead of the competition by deciphering key consumer and market trends driving a change in vehicle affordability patterns to arrive at the right price and loan balance."

Views: 9

Comment

Oops... You need to stop "Lurking" on ADM and become a more genuine Automotive Professional by completing your membership registration. As a registered ADM Member, you can post comments, publish your own articles (be a star!) and start Forum discussions. Stop being an online "Peeping Tom" and JOIN ADM RIGHT NOW!

Join Automotive Digital Marketing

Automotive Professional Network and Resource Exchange for Car Dealers, Managers, OEM and Marketing Practitioners seeking Best Practices.

ADM Sponsor

Please Consider Automotive Marketing Professional Community Sponsors

ADM Badge

Loading…

Based On Your Interests...

ADM Consulting, LLC

Onsite/Offsite Combination ADM Consulting, LLC Professional Services
Select the maximum monthly investment you plan to make
$USD
Sign up for

Automotive Marketing Tools

Get ADM Toolbar

Click here to take the ADM Member Survey

Getting too many emails from ADM? Click mailbox below to control which types of alerts and updates you are sent......


Instagram

Top Automotive Marketing Forum Discussions

2. 5 Ideas for car dealers FB page

Posted by Kevin Lewis on August 6, 2019

Share the Best Content w/AutoMarketing Community

© 2019   Created by Ralph Paglia.   Powered by

ADM Badges  |  Report an Issue  |  Terms of Service