Since reaching its low point last winter, the economy has slowly been on the rebound, seeing stock markets rise, unemployment decrease and consumer spending return to levels not seen since before the recession. On Tuesday, credit agency TransUnion announced yet another example of economic recovery: more consumers are paying off their car loans.
According to TransUnion, during the first quarter of 2011 the 60-day auto loan delinquency rate fell to 0.49 percent. The figure, which measures the ratio of auto loan borrowers 60 or more days past due, is the lowest since TransUnion began tracking the figure in 1999.
"Continued improvement in auto delinquencies is a reflection of the stronger auto sales market," said Peter Turek, automotive vice president in TransUnion's financial services unit. "As consumers' confidence in the economy improves, and with auto loan rates remaining at relatively low levels, more people are making auto purchases. Add to that the fact that consumers with auto loans are making timely payments and we are seeing delinquency rates at record low levels."
TransUnion also reported on several other auto loan metrics, nearly all of which show economic recovery. The credit agency's Auto Inquiry Index, which measures demand for loans, showed a 14-percent year-over-year increase, with the strongest surges in Washington, Alaska and Vermont. Only Hawaii, Tennessee and Washington DC experienced a decrease in auto loan demand.
According to the credit agency, the average debt per borrower decreased slightly year-over-year, while total auto debt edged up slightly, signaling a slight increase in loans being granted. TransUnion says that borrowers in Washington DC carry the highest debt burden per borrower at $16,268, while Nebraska borrowers carry the lowest at just $11,096. Meanwhile, loan delinquency was highest in Mississippi and Louisiana, and lowest in Montana and Washington DC.