Also Setting Records: Auto Sales and Auto Loan Debt
"The amount of money borrowed to pay for new and used vehicles climbed to an all-time high of $968 billion in the third quarter," reports Phil LeBeau. That fact comes from new data from Experian, which tracks auto loans.
Melinda Zabritski senior director of automotive finance with Experian provides this soundbite explaining the trend: "We're seeing record auto sales and vehicle prices are up, so loans are increasing….Also, more people are paying for their vehicle with an auto loan as opposed to financing it with a home equity loan or paying cash."
Mimicking recent trends in gas consumption and vehicle miles travelled, if Americans continue the current pace of automobile sales, "the U.S. will set a record for annual sales with an expected total of 17.46 million vehicles."
The article also includes some scary discussion about a bad word, for anyone who lived through 2008: subprime loans. Subprime auto loans have been steadily increasing since 2011, according to Experian. According to LeBeau, there is also "no shortage of people who are suggesting America's red-hot auto market is being fueled by a bubble in subprime auto loans."