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60-Day Delinquencies Rise by 21.2 Percent in 2Q

Automotive loans that are 60 days past due rose by 21.7 percent in the second quarter 2009 compared to the year-ago period, according to Experian Automotive.

by Staff
September 10, 2009
3 min to read


SCHAUMBURG, Ill. — Automotive loans that are 60 days past due rose by 21.7 percent in the second quarter 2009 compared to the year-ago period, according to Experian Automotive.

During its quarterly State of the Auto Finance Market Webinar, Experian Automotive provided a comprehensive view of the market in the first half of 2009 compared with the first half of 2008.

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In the second quarter of 2009, 0.80 percent of all automotive loans were 60 days past due, compared with 0.66 percent in the year-ago period. Thirty-day delinquencies also rose by 14.6 percent in the second quarter to 3.06 percent, up from 2.67 percent the year before. Combined, 30- and 60-day delinquencies accounted for $25.5 billion in at-risk loans.

“Challenging economic times continue to take a toll on the automotive finance world,” said Scott Waldron, president of Experian Automotive. “As the recession continued to drag on during the second quarter, the rate of delinquency rose much faster from the first to second quarter than it did the previous year. This caused lenders to tighten criteria and push some consumers out of the new vehicle market.”

Experian Automotive’s analysis showed that market conditions were pushing a higher percentage of vehicle shoppers into used-vehicle financing. Used-vehicle financing rose by 5 percent from the first half of 2008 (62.73 percent) to the first half of 2009 (66.06 percent). This shift in used market share did bring increased market share to independent used-vehicle retailers, who saw their financing share rise by more than 7 percent year-over-year (30.88 percent in the first half of 2008 to 33.11 percent in the first half of 2009).

There were other positive signs in the market based on loan attributes. The average length of newly originated loans for new vehicles dropped from 63 months in the first half of 2008 to 62 months in the first half of 2009. In addition, the average loan amount rose by $105 to $24,265 in the first half of 2009, up from $24,160 in the first half of 2008. Despite the rise in total loan amounts, average monthly payments on new car loans dropped from $458 in the first half of 2008 to $453 in the first half of 2009.

“Consumers were financing larger amounts for new vehicles in the first half of 2009 compared with the first half of 2008, which could be a sign that overall consumer confidence is starting to rebound,” said Melinda Zabritski, director of automotive credit for Experian Automotive. “If new vehicle loan amounts continue to see increases into the third quarter, it will be a very positive sign for the auto industry.”

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Other findings:

• Top 20 lenders overall represented 42 percent of all loans originating in the first half of 2009. This was a 5.38 percent decrease year-ago period.

• Top 20 lenders by market share: Chase, Wachovia, Toyota, Ford, Honda, GMAC, Bank of America, Capital One, Chrysler, Nissan Infiniti, 5th 3rd

• Bank, BMW Bank, Citizens Auto, U.S. Bank, BB&T Bank, Credit Acceptance, USAA, SunTrust Bank, CarMax, Volkswagen.

• Three states had a reduction in 30-day delinquencies: Alaska (15 percent), Nebraska (3 percent) and Michigan (2 percent).

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• The states with the largest percentage increase in 30-day delinquencies were Idaho (61 percent), Montana (38 percent), Hawaii (32 percent), Washington (28 percent) and Utah (27 percent).

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