Percent of subprime auto loans grows in 2Q
DETROIT (AP) — The percent of auto loans granted to subprime buyers is growing as the economy improves. And so far, those buyers are paying their bills.
Experian Automotive, which tracks the auto loan industry, says just 2.38 percent of loans were 30 days' delinquent in the second quarter, down 5.6 percent from a year ago. That was the lowest second-quarter delinquency level since 2006, when Experian started tracking the data. Sixty-day delinquencies were flat year over year, at less than 1 percent.
Experian says 35.2 percent of loans granted in the April-June period went to subprime buyers, or those with a Vantage credit score of 700 or lower. That's slightly higher than the 34.9 percent of loans that went to subprime buyers in the second quarter of 2012.
Repossession rates also fell nearly 15 percent in the second quarter. Less than 1 percent of loan holders had their vehicles repossessed.
Experian said the total balance of outstanding automotive loans grew 10 percent to $751 billion during the period.