SCHAUMBURG, Ill. — Experian Automotive today announced that quarterly vehicle repossessions dropped by 14.8 percent in the second quarter to their lowest rate since the firm began tracking the data seven years ago.
According to the company’s latest “State of the Automotive Finance Market” report, 0.36 percent of all vehicle loans ended in a repossession, down from 0.43 percent in the year-ago period. This change also represented a 10.4 percent decrease from the previous low of 0.41 percent recording in the second quarter 2006.
Additional findings from the report showed that 30-day delinquencies decreased by 5.6 percent on a year-over-year basis, falling from 2.52 percent in the year-ago quarter to 2.38 percent in the second quarter 2013. While slightly up from the first quarter (by two basis points), this decrease brings 30-day delinquencies to their lowest level for the second quarter since 2006.
Sixty-day delinquencies remain relatively flat year over year but still are extremely low at 0.58 percent.
“Repossession and delinquency rates seen this quarter were lower than expected,” said Melinda Zabritski, Experian’s senior director of Automotive Credit. “The seasonality of the market usually has the first quarter showing the lowest 30-day delinquency rates, but even with the total automotive loan portfolio growing, consumers in the second quarter have done an exceptional job of meeting their financial obligations to keep the market strong.”
The report also showed that the total balance of outstanding automotive loans grew from more than $682 billion in the second quarter 2012 to nearly $751 billion in the second quarter 2013. Banks increased their total dollar volume by $24 billion, followed by credit unions ($18 billion), finance companies ($16 billion) and captive finance companies ($11 billion).
Here are additional highlights from the report:
• The balance of loans that are 30 days delinquent rose by $761 million in the second quarter. However, on a percentage basis, delinquencies represent just 1.96 percent of the total loan balance, down from 2.05 percent in the year-ago period.
• Sixty-day delinquencies account for just 0.42 percent of the total loan portfolio dollar value.
• Nonprime, subprime and deep-subprime loans account for 35.2 percent of all open vehicle loans in the second quarter, up from 34.9 percent in the year-ago period.
• Average charge-off amounts for defaulted loans were up by $450 vs. the second quarter 2012.