Auto loan delinquencies at all-time low

August 28, 2012 12:00 AM

According to a recent Los Angeles Times report, delinquency on auto loans is at the lowest rate since the information started being tracked by TransUnion in 1999. The agency defines delinquency as when a borrower is 60 or more days late on payment.

The report shows that the delinquency rate dropped from 0.36 percent in the second quarter to 0.33 percent in the third quarter. Overall, the rate is down 25 percent from last year. 

"Consumers now value their auto loans more than their credit cards and mortgages. This is partly due to the need for transportation to get to work or to seek employment in a difficult job market," Peter Turek, automotive vice president in TransUnion's financial services business unit, told the news outlet. Consumers are relying on their cars and are ensuring loans are paid on time and oil changes happen at regular intervals.

California has a slightly higher rate than the national average at 0.37 percent in the second quarter. However, Louisiana, Mississippi and Oklahoma have the highest rates, which are in the 0.55 to 0.6 percent range. 

However, the agency reported these rates are not the norm and people can expect slight increases the rest of the year.

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