The average loan amount and monthly payment for a used vehicle reached an all-time high in the second quarter of 2014, according to the credit bureau Experian.
The average used vehicle loan was $18,258 in the second quarter of 2014, up $345 from the previous year, Experian reports in its just-released quarterly update. Meanwhile, the average monthly payment for a loan written on a used vehicle was $355 in the second quarter 2014, up $4 from a year earlier.
“Used vehicle financing has experienced consistent growth over the last several years,” said Melinda Zabritski, senior director of automotive finance for Experian. “As we continue to see the price of vehicles reach new heights, more and more consumers, especially those that are credit challenged, are turning to the used vehicle market as a viable option to purchase their next car.”
As for new vehicles, Experian said that the average amount financed jumped to $27,429 from $26,526 in the second quarter of 2013. The average monthly payment for a new vehicle, also increased $10 to $467 in the second quarter of 2014
Experian Automotive also announced that the percentage of new vehicle loans to subprime and deep subprime borrowers began to level off in the second quarter of 2014. The percentage in those two segments was at 15.1 percent in the second qurater of 2014, down from 22.1 percent in the second quarter of 2013.
In other trends, Experian found:
• Of all new vehicles sold in Q2 2014, leases accounted for a record high 25.6 percent, up from 23.4 percent the previous year
• The interest rate for a new vehicle was up from 4.46 percent in Q2 2013 to 4.59 percent in Q2 2014
• Used vehicle interest rates were up from 8.56 percent in Q2 2013 to 8.82 percent in Q2 2014
• The average credit score for a new vehicle loan in Q2 2014 was 711, up from 699 a year earlier
• The average credit score for a new vehicle lease rose to 717 in Q2 2014 from 706 in Q2 2013