Sixty-Day Delinquency Rate Up for the Quarter, Down for the Year
Credit reporting agency TransUnion reported a seasonal hike in the rate of U.S. auto-loan borrowers more than 60 days past due.
CHICAGO — Credit reporting agency TransUnion reported a seasonal hike in the rate of U.S. auto-loan borrowers more than 60 days past due. The 60-day delinquency rate for the third quarter 2010 stands at 0.58 percent, an increase of 9.4 percent from the second quarter. However, the year-over-year rate continues to decline, and TransUnion projects further improvement in the new year.
The agency’s projected 60-day delinquency rate for the end of 2010 is 0.62 percent. By the end of 2011, according to TransUnion’s forecast, it should fall to an even 0.60 percent. That would represent a 3.2 percent decline over the course of 2011, a staggering 30 percent decline from 2008, when the recession reached its nadir.
Peter Turek, automotive vice president in TransUnion’s financial services group, said that “expected seasonal factors” are to blame for the uptick between the second and third quarters. He is encouraged by the performance of the agency’s prior forecasts and believes delinquency rates will begin to stabilize.
“This trend toward fiscal responsibility is reflected in year-over-year results, as auto delinquency rates now have dropped 28.4 percent since third quarter 2009 — the largest decline since the summer of 2001,” Turek said. “On a state-level basis, 12 states experienced a drop in their quarter-to-quarter delinquency rates, while only two states showed an increase on a year-over-year basis.”
Those states were Mississippi and Louisiana, which finished the third quarter at 1.12 percent and 1.10 percent past due, respectively. At the other end of the spectrum, Wyoming (0.23 percent), North Dakota (0.23 percent) and Pennsylvania (0.32 percent) led the way with the lowest rates.
Wyoming also showed marked improvement from the previous quarter. The state registered a 30.3 percent decrease from a 60-day delinquency rate of 0.33 percent in the second quarter, bested only by Rhode Island (33.8 percent decrease from 0.74 percent).
Average U.S. auto debt for 60-day borrowers fell from $12,643 to $12,500 between the second and third quarters and was “essentially flat” on a year-over-year basis, according to TransUnion’s report; however, auto-loan originations were up 5 percent. Idaho and Texas registered quarterly decreases of 5.5 percent and 3.6 percent, respectively, in average auto debt, while Wisconsin (2.9 percent), Mississippi (2.4 percent) and New Jersey (1.9 percent) led the way in quarterly increases.
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