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. That’s because a TransUnion study has indicated that delinquency rates for consumer auto loans that are at least 60 days past due decreased substantially within the second quarter of 2010. This welcome sign of recovery was a nice addition to TransUnion’s previous finding the number of charge card delinquencies had also waned.
Rainy day saving keeps restoration coasting in neutral
Fewer consumers have been willing to plunk down their incredible shrinking dollars on large ticket purchases like automobiles, which has been less than stimulating for prospects of an economic turnaround. Yet it has been a good for auto loan repayment habits, says Peter Turek of TransUnion.
”Although part of the reason for the turnaround 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,” said Turek.
A 20% improvement compared to the first quarter of 2010
Auto loan delinquency rates for consumers later than 60 days on their payment was down by .53 percent as outlined by the Journal. This can be a 20 percent improvement over the previous quarter’s performance. It’s the largest decrease since the summer of 2001, writes the Journal. Vermont came out on top when it comes to most improved payees, Rhode Island, Utah and Montana came out on the bottom. The Maple Syrup state experienced nearly a 50 percent drop, from 1 percent to .58 percent. In related news, Hawaii experienced the greatest drop in car loan origination. Milking old vehicles for everything they’re worth is probably less expensive than purchasing a gallon of milk in Hawaii, anyway.
By the fourth quarter of 2010, however, TransUnion is predicting a .6 percent increase in late payment. Thus, enjoy what’s promising when you can. The probable cause would be the envisioned weight of holiday spending.
Further reading
Wall Street Journal
online.wsj.com/article/BT-CO-20100830-703526.html
