by Christopher Freeburn | May 23, 2012 2:29 pm
Data issued by credit reporting firm TransUnion show that late payments on auto loans dropped sharply during the first quarter of 2012.
Auto loan payments late by at least 60 days fell 27% to 0.36%, compared to the same time last year. This marks the 10th consecutive year-over-year quarterly decline for late auto loan payments.
The current level of late payments is also 22% lower than the final quarter of last year, the Associated Press noted. In fact, late payments are at their lowest level since 1999, when TransUnion first started recording late auto loan payment data.
With auto sales rising, lenders are extending loans to less creditworthy borrowers.
TransUnion officials noted that borrowers were choosing to made their auto loan payments ahead of other loans, including mortgages, equity lines of credit and credit cards.
While late payments were down, TransUnion noted that total auto loan debt had increased, with the average auto loan up 5% from last year to $13,272.
During the economic crisis that began in 2007, consumer cut back on borrowing and attempted to pay down debts. A renewed willingness by consumers to borrow likely signals increased confidence in the economy.
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