Smart Borrower Blog

Archive for the ‘Auto Loans’ Category

Credit Card Use Jumped in December

U.S. consumers pulled out their plastic in greater numbers for purchases in December, according to information from the Federal Reserve Tuesday. Total credit debt increased substantially as well. Revolving credit, such as credit card debt, grew by $2.76 billion in December to $800.98 billion, after rising $5.58 billion in November. Non-revolving credit, driven by student loans and auto loans, posted a $16.55 billion increase, to $1.697 trillion, also following a major jump in November. Total consumer credit debt rose by $19.31 billion in December, a striking increase compared with a prediction from economists surveyed by the Dow Jones Newswires that... more »

Fed Keeps Rate At Rock Bottom, No Changes Likely Until 2014

After its two day meeting, the Federal Reserve decided to leave its target interest rate unchanged, and also forecasted that it will not raise rates until the end of 2014. The federal funds rate, the Fed’s main method of affecting inflation and the economy, will remain in the range of zero to 0.25 percent for at least the next six weeks. It was predicted in a statement that, “Economic conditions…are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.” Low Fed rates have kept mortgage, car and student loan rates exceptionally low for... more »

Subprime Borrowers Boost Auto Lending

The automotive lending pipeline has started to open up again for borrowers with less than stellar credit. According to new reports, car loans for subprime buyers, or those with credit score between 550 and 620, have risen substantially this year, indicating a revival of lending among that market segment. Information from CNW Research and Experian, as reported in a CNBC article, shows that the number of car loan approvals for those with poor credit have jumped up 15.72 percent already this month over the whole month of November, while approval for individuals with good scores rose just 1.36 percent from... more »

Consumer Borrowing, Credit Card Use Up in October

Consumers continued to borrow more money in October, according to the latest figures from the Federal Reserve, and the trend could suggest either progress or danger. Total consumer credit grew by $7.6 billion to $2.457 trillion, outpacing September’s $6.88 billion increase. Americans have upped their spending and borrowing for 12 of the past 13 months, with August being the notable trend-breaker. Borrowing during that month fell by the most in 16 months. Still, in general U.S. consumers have been taking on more debt. Non-revolving credit, including student loans and car loans, rose 5.3 percent, or $7.28 billion in October. This... more »

Auto Delinquencies Post Slight Seasonal Rise

There were more auto loan borrowers behind on their payments during the third quarter of this year compared to the previous quarter, but the small uptick is nothing to worry about, according to credit reporting agency TransUnion. The percent of customers who were late by 60 days or more on their car payments rose to 0.47 percent between June and September, up from 0.44 percent in the second quarter. The new rate is still part of a downward trend, as it is down from 0.58 percent one year ago. TransUnion reports that auto delinquencies typically rise in the third quarter... more »

Consumer Borrowing Makes Surprising Jump

Consumer credit borrowing in the U.S. increased substantially in September from the previous month, spurred on by rises in student and auto loans. Borrowing rose by $7.39 billion to a total of $2.542 trillion, according to the Federal Reserve. This was a particularly surprising increase after consumer credit fell $9.68 billion August, and analysts only predicted a growth of $4 billion for September. The increase was apparently led by a jump in borrowing for items like cars and tuition. Non-revolving credit, which includes both those types of loans rose $8.01 billion in September to a total of $1.662 trillion. Revolving... more »

Equifax Anticipates Return to Pre-Recession Auto Loan Levels

Auto loan originations continued to grow on a yearly basis during the first six months of 2011, according to a new report from credit reporting agency Equifax, and figures could be back into pre-recession territory by the end of the year. During the period from January to June 2011, new car loan originations increased 15 percent to 9.6 million, up over the first six months of 2010, when total loans were at 8.3 million. Moreover, when factoring in total originations from the first half of 2009, which were only 7.5 million, this is quite a significant trend. However, the new... more »

Consumers Continue to Keep Up With Car Loans

Here’s a little good news in a dour financial market: Americans are doing better and better at making their car payments on time. A new survey from credit reporting agency TransUnion says that the percentage of borrowers who were 60 days late or more on their auto loans fell during the second quarter of this year for the seventh quarter in a row. During the period of April to June, only 0.44 percent of all all auto loans were delinquent by 60 days or more, down from 0.53 percent during the same time last year. “The numbers indicate that consumers... more »

Lending Standards Eased Slightly Again in Latest Quarter

Banks loosened their lending standards on several types of loans during the past three months, according to the Federal Reserve’s survey of senior loan officers . Those finding the easiest access to loan capital are large and medium-sized businesses, as well as car buyers. In the survey, which polled 55 domestic and 22 foreign banks, 21.8 percent of all banks said that they eased their lending standards for large companies in the third quarter from the second. And 20 percent said they had made it easier for auto loan applicants to get approved. “In spite of the equity market volatility,... more »

Q1 Auto Loans Beat ‘Cash for Clunkers’ Results

The U.S. auto lending market is continuing to grow, according to the latest data from credit reporting agency Equifax Inc. The number of car loans increased by 21 percent during the first quarter of this year compared to the same time last year. “While some sectors of the economy – most notably housing – continue to struggle, the auto lending sector has displayed positive gains based on loosening of credit to both prime and subprime borrowers paired with improvements in consumer payment behavior, which is reflected in the declining number of auto loan delinquencies,” said Michael Koukounas, Senior Vice President... more »