It’s that time of year again when days are longer, temperatures are higher and auto dealers advertise some of the most tempting deals. And while there’s nothing new about new car fever or the annual ad blitz, there’s a good deal of news on how consumers are choosing and paying for their cars.
For example, new car sales increased more than 5 percent from a year ago. At the same time, the average credit score for a new car loan dropped to 710 and even lower to 645 for a used vehicle.
These data points provided by Experian, a major market intelligence firm, also recently reported that today the average monthly car payments are also at an all-time high: $503 for a new car and $376 for a used one. Car loan terms are also longer and the amounts financed are both larger too. On average, both new and used car loans are respectively 68 and 66 months. The average new car loan is now an all-time high at $30,032.
“The continued rise in new vehicle costs have kept many consumers exploring options to keep their monthly payments affordable,” said Melinda Zabritski, Experian’s senior director of automotive finance. “As long as vehicle prices continue to rise, we can expect leasing rates to grow along with them. . . .The record highs we have seen in vehicle prices also have had a significant impact on the loan market.”