It looks like Americans are feeling more confident about borrowing money again, at least when it comes to their cars. Credit reporting giant Equifax has released its latest National Consumer Credit Trends Report, and the data suggests that auto lending is booming in 2014.

The total amount of outstanding auto loans in the US amounted to $902.2 billion in the company's analysis. Not only was that a new record, it was also a 10-percent increase from a year ago. "Auto lending continues to thrive, accounting for more than fifty percent of all new non-mortgage lending through April of 2014," said Dennis Carlson, Deputy Chief Economist at Equifax, in the study.

The results mixed some bright spots with some seemingly worrying trends following the recent subprime credit crisis, though. According to the report, year-to-date new auto loans as of April 2014 reached $163.5 billion, the highest amount since 2005, and the number of them in that period was also at record levels. According to Carlson, the amount of delinquencies was at near-record lows of less than 1 percent of that $902 billion.

"Subprime lending has grown across all sectors in 2014. This is good news as a fully functioning second-chance market is essential for a healthy economy," said Carlson in the study. Auto loans to these buyers reached $46.2 billion year-to-date, an eight-year high, which made them about 28 percent of the total loan balance from this year.

The rest of the report indicated a strong credit market elsewhere too. Banks issued more credit cards, and overdue accounts were at a five-year low. The total amount in mortgages was actually down from last year, but delinquencies were lower as well. Want to know more? Scroll down.
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Equifax Reports Auto Loan Balances Hit All-Time High Mid-Way Through 2014 Outstanding Loan Balances Exceed $900 Billion for First Time in History

ATLANTA, July 24, 2014 (GLOBE NEWSWIRE) -- According to the latest Equifax (NYSE:EFX) National Consumer Credit Trends Report, the total balance of auto loans mid-way through 2014 is $902.2 billion, a record high and an increase of more than 10% from same time a year ago. In that same time, the total number of auto loans outstanding is more than 64 million.

"Auto lending continues to thrive, accounting for more than fifty percent of all new non-mortgage lending through April of 2014," said Dennis Carlson, Deputy Chief Economist at Equifax. "Lenders are responding to record low delinquencies by offering great rates and terms, while consumers are responding to the improving economic conditions by making the decision to purchase newer vehicles. Additionally, subprime lending has grown across all sectors in 2014. This is good news as a fully functioning second-chance market is essential for a healthy economy."

Despite record high balances, serious delinquencies on auto loans remain near all-time lows, representing less than 1% of total outstanding balances for the third consecutive month. In addition, the total balance of new credit originated for auto loans year-to-date in April is $163.5 billion, the highest since at least 2005.

Other highlights from the most recent Equifax data include:

Auto

The total number of new loans originated year-to-date in April is 8.1 million, an eight-year high;
The total number of new loans originated in that same time for subprime borrowers, or consumers with risk scores of 640 or lower, is 2.6 million, representing 32% of all auto loans originated today;
Similarly, the total balance of subprime auto loans is $46.2 billion, an eight-year high and representing 28.2% of the total balance of new auto loans.

Bank-issued credit card

The total balance of bank card credit outstanding increased by 2.2 year over year;
The total number of new cards issued through the first four months of 2014 was 15.5 million, a six-year high and an increase of 17.2% from same time a year ago;
Similarly, the total dollar amount of new credit originated in that same time is $77.4 billion, also a six-year high and an increase of 24.1% from same time a year ago;
Accounts 60-or-more-days past due (excluding write-offs) as a percentage of total loans is 1.60 and a five-year low.

First Mortgage

The total balance of first mortgages declined by 2.5 compared to the previous year;
Delinquent first mortgages, those 30-days or more past due, represent less than 4.78 from same time a year ago;
Similarly, the total balance of first mortgages 90-days past due or in foreclosure is less than $220 billion, a six year low and a decrease of more than 36.8% from same time a year ago.

Home Equity Revolving

The total balance outstanding on home equity revolving loans continues to decline, falling 5.4% in June from the same time last year;
The total limit of new credit year-to-date in April is 33.3 billion, an increase of 17.4% from same time a year ago, and the highest since 2008;
In that same time, more than 333,000 new loans were originated, realizing a five-year high and a year-over-year increase of 12%.

About Equifax, Inc.

Equifax is a global leader in consumer, commercial and workforce information solutions that provide businesses of all sizes and consumers with insight and information they can trust. Equifax organizes and assimilates data on more than 600 million consumers and 81 million businesses worldwide. The company's significant investments in differentiated data, its expertise in advanced analytics to explore and develop new multi-source data solutions, and its leading-edge proprietary technology enable it to create and deliver unparalleled customized insights that enrich both the performance of businesses and the lives of consumers.

Headquartered in Atlanta, Equifax operates or has investments in 19 countries and is a member of Standard & Poor's (S&P) 500® Index. Its common stock is traded on the New York Stock Exchange (NYSE) under the symbol EFX. In 2013, Equifax was named a Bloomberg BusinessWeek Top 50 company, was #3 in Fortune's Most Admired list in its category, and was named to InfoWeek 500 as well as the FinTech 100. For more information, please visit www.equifax.com.


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    • 1 Second Ago
  • 40 Comments
      David Judkovics
      • 4 Months Ago
      "Subprime lending has grown across all sectors in 2014. This is good news as a fully functioning second-chance market is essential for a healthy economy, ..." But by many metrics this is not a healthy economy for the working class. And until there are real signs it is healthy the subprime market is a poison to creating one. http://www.zerohedge.com/news/2014-07-22/rising-wages-where-real-wages-post-first-annual-decline-2012 Mr. Carlson's remark is a good example of being disingenuous.
        Edsel
        • 4 Months Ago
        @David Judkovics
        I'd give you +10 if I could.
      Finn
      • 4 Months Ago
      ......."The total amount of outstanding auto loans in the US amounted to $902.2 billion in the company's analysis. Not only was that a new record, it was also a 10-percent increase from a year ago. "Auto lending continues to thrive, accounting for more than fifty percent of all new non-mortgage lending through April of 2014,"...... And Milk and Honey are just 'round the bend.....
      Scooter
      • 4 Months Ago
      I read a forum discussion about Focus ST owners and the details of their loans. Many if not most included negative balances from trade in's. While most rates were decent many of them if not all, were on maximum repayment schedules. 6 year loans were common. Scary thing about that is if any body buys anything like an FRS or ST new, they will be upside down for most of the loan. I found the average ST to total $27-$30k out the door (not counting interest)... Although the ST after a year or so of ownership carries a true value around $17-$19k. Leaving owners nearly underwater most of the loan period. I've seen that most people treat these things like revolving doors. Many owners, probably many here, are eager to overreach. Sad because someone like me will snag the same car in two years for oodles less.
        superchan7
        • 4 Months Ago
        @Scooter
        You're sad that someone else took the risk for you? The only sad part is that person was less financially capable than you. He took four times the risk you plan to take--buying expensive x2 and going underwater x2.
          JonZeke
          • 4 Months Ago
          @superchan7
          He's sad that people are so ignorant. Yes he benefits but invoking a little compassion and empathy for those who choose poorly is a positive human trait.
          Scooter
          • 4 Months Ago
          @superchan7
          I understand that in order for me to snag a great car for a great price some person had to take a risk and most likely lose money on that car. It's usually the 2nd owner who will enjoy the car longer and the sacrificed money from the first owner.
        superlightv12
        • 4 Months Ago
        @Scooter
        What about the re-sale on a $50K SUV or Cadillac? Those things drop like a rock in value. I'd bet an ST has a lower decline in value than most popular GM SUV's do. $50K new, $30K a year later.
      Justin
      • 4 Months Ago
      Consumers aren't feeling more confident; the car loan bubble is a repeat of the hosting bubble circa mid 2000s.
      tenspeeder
      • 4 Months Ago
      ...strong credit market... and a couple days ago there was the report that 1/3 of all Americans have loans in collections. hopefully people aren't being approved for more than they can realistically afford.
      Jmaister
      • 4 Months Ago
      upside down loan is VERY BAD!!! dont let the dealer pay off your credit card, cuz they dont.
      Scooter
      • 4 Months Ago
      The American live affair with cars hasn't died since the fifties. Except these days Jr can't work a little hard for a summer to buy a nice fast car. Jr's target car touches his annual income in sale price and cost more than what he can save in a reasonable time period. Cars simply cost more than they ever did. Social pressure is incredibly high to keep up with the Jones's. Yet people have less money lying around than ever before. Watch Suze Ormans "Can I Afford it?" segment. Terrifying stuff.
        superchan7
        • 4 Months Ago
        @Scooter
        Equivalent cars have gotten cheaper as express2day asserts. Forget staying with the same model name; today's Honda Civic is bigger and faster than a 1980s Accord. It also has way more comfort and safety features. "Keeping up" with other people is a choice. Some of them really are that wealthy; some of them go upside down for show.
      Bill
      • 4 Months Ago
      Suckas. So my "new" used car is only a Focus, but I paid cash, and I could have afforded much nicer car. Instead of financing a depreciating asset, I'm starting a real estate portfolio so those that can't live within their means get to pay me rent. Ka Ching.
        superchan7
        • 4 Months Ago
        @Bill
        You're going into real estate at the height of a bubble?
          John S
          • 4 Months Ago
          @superchan7
          Not height of bubble in my parts. Location, location, location.
        Jmaister
        • 4 Months Ago
        @Bill
        those cant live within their means? its those folks that exploit the market, or in Canada's case, exploit the immigration law that resulted in most of my generation cant afford a place. STFU.
        clquake
        • 4 Months Ago
        @Bill
        So, you're going to rent to dead beats? Have you thought this through at all?
        superlightv12
        • 4 Months Ago
        @Bill
        Quick, buy a bunch of gold while the price is still high.
      Sergio Freddson
      • 1 Month Ago
      Wow, I had no idea that the rates would boom so dramatically this year. I agree: this is a good indicator that the working class is really struggling. Thanks for posting this brief summary, this is good information to be aware of. http://www.premierautosalesfortwayne.com
      Elizabeth Patrick
      • 4 Months Ago


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