The Wall Street Journal reports that after many long months of bad news for the recession-laden vehicle industry, it’s time for some good news. Credit agency TransUnion has conducted a study indicating that car loan late payment percentage of 60 days or more has fallen noticeably in the past quarter of 2010. TransUnion has just been full of good news since they announced a decrease in credit card payment delinquency.
Saving money makes the overall economy sluggish
Fewer consumers are willing to plunk down their incredible shrinking dollars on big ticket purchases like automobiles, which has been less than stimulating for prospects of an economic transformation. Yet it has been a good for car loan repayment habits, states Peter Turek of TransUnion.
”Although part of the reason for the in delinquency percentage is the influence of new, lower risk loans, consumers do not see a quick fix to the short-term economic and employment situation,” exclaimed Turek.
A 20% drop is really a huge boost above the first quarter
The auto loan delinquency rate drop for delinquencies of 60 days or more fell to .53 percent, which constitutes a 20 percent decrease from 2010’s first quarter. Moreover, the decrease is probably the most significant to occur since the summer of 2001. Rhode Island, Utah and Montana really displayed a rise in frequency, while Vermont showed the most improved payment performance. A near 50 percent drop in Vermont (from 1 percent to .58 percent) is certainly good news. On a parallel note, Hawaii’s rate of loan origination was lowest in the study. The reason could possibly be the expense of living in Hawaii. It makes holding onto old cars an attractive proposition.
In spite of the good news, TransUnion’s experts predict a .6 percent increase in delinquency by the fourth quarter. Blame it on the holidays, why don’t you.
Wall Street Journal
online.wsj.com/article/BT-CO-20100830-703526.html
