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People who buy a new vehicle borrow more and pay more each month for their auto loan.
Experian, which tracks millions of car loans each month, said the average amount borrowed to buy a new vehicle hit a record $32,187 in the first quarter. The average used vehicle loan also hit a record high of $20,137.
“We haven’t seen a slowdown in loan demand. In fact, new and used loan volume is up from previous years,” said Melinda Zabritski, senior director of automotive finance solutions for Experian. .
As new vehicle sales slow slightly after the best four years the industry has ever seen in the U.S., auto dealers and executives are watching to see if consumers will be more resilient to steadily rising vehicle prices. new cars. This is not the case. In fact, the average amount borrowed exceeded $32,000 for the first time ever.
As a result, the average monthly payment for a new vehicle continued to climb to a new high of $554 and a record high of $391 for used vehicles, according to Experian.
While new car sales and loans are still strong, people with the best credit ratings are increasingly buying a used model rather than a new one. Experian reports that 61.8% of those with prime credit ratings and 44.7% of those with prime credit ratings took out loans to buy a used vehicle in the first quarter. These are the highest percentages Experian has ever recorded for prime and prime used vehicle loans.
It’s a trend that Zabritski has seen increase in recent years. “Consumers seem to be taking advantage of options to reduce payments, especially leasing,” she said.