Auto Leasing Sets New High as Purchase Loans Get Longer

Auto Leasing Sets New High as Purchase Loans Get LongerAuto leasing is waging a big comeback as these non-purchase financing deals accounted for 27.5 percent of all new vehicles acquired in the first quarter, according to the credit bureau Experian.
That’s the highest level of leasing Experian has recorded since it started monitoring auto financing in 2006.
The first-quarter surge marks a 3.1 percent increase from one year ago.
“People want the lowest monthly payment possible for a new car or truck and many times they can get that with a lease,” said Melinda Zabritski senior director of Automotive Credit with Experian.
Auto financing is a prospering business nowadays as U.S. car and truck sales continue to improve month-to-month.
The amount financed for the purchase of a vehicle increased $620 to $26,648 in the first quarter. However, consumers kept their monthly payments under control. During the first quarter, Experian found that the average monthly payment for new vehicle loans was $459, a decline of $3 compared to the same time last year.
Auto and truck buyers managed to keep their monthly payments down by extending loan terms over a longer period of time.
In the first quarter, the percentage of auto loans reaching 73 to 84 months soared 27.4 percent. These six-year and longer loans now make up 19.5 percent of all new vehicle purchase transactions.

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