Loan Amounts Reach Record Highs in Q3, from F&I Magazine.
The average dollar amount for both new and used vehicle loans reached all-time highs in the third quarter of 2014, according to Experian Automotive’s latest State of the Automotive Finance Market report. The average loan amount for a new vehicle was $27,799 in the third quarter of 2014, up $1,080 from the previous year. Used vehicle loans increased $676, reaching $18,576 over the same time period.
With the continued growth in loan amounts, the quarterly findings also showed consumers leasing at a higher rate, as well as taking out longer loans. The report found that leasing accounted for 29.1% of all new vehicle financing in third quarter 2014, up 7.1% from a year ago. New vehicle loans in the 73- to 84-month range grew by 23.7% in third quarter 2014 compared with the previous year, while used loans in the same range grew by 18% from a year ago.
“Car buyers tend to shop with a monthly payment in mind. As a result, we are continuing to see them turn to leasing and longer loan lengths as strategies to keep payments down and make vehicles more affordable,” said Melinda Zabritski, senior director of automotive finance for Experian. “As car values continue to reach new heights, these insights will help dealers, lenders and consumers become more aware of the options available to them to keep people buying cars, all while staying within their budgets.”
