LOS ANGELES (AP) — Many Americans are carrying higher auto loan balances, but the increased financial strain isn't resulting in more missed payments, new data shows.
Average auto loan balances have increased amid a strong market for cars and trucks this year, rising to $13,435 in the second quarter. That's up 4.5 percent year-over-year and a 1.3 percent increase from the first quarter. Many drivers have moved to replace older vehicles after holding back on purchases for several years following the last recession. Low interest rates and good lease terms have also helped fuel U.S. auto sales, which jumped 14 percent to 1.3 million in July.
As more drivers have gone car shopping, lenders have responded, making loans available to more borrowers, even those with less-than-perfect credit. The new loans, which tend to have higher balances early on, are pushing up the average balance.
But Americans are keeping up with the payments. The rate of U.S. auto-loan payments late by 60 days or more was essentially flat in the April-June quarter, inching to 0.80 percent from 0.79 percent in the second quarter of last year, credit reporting agency TransUnion said Tuesday. The delinquency rate dropped from 0.88 percent in the first three months of the year.