The average monthly loan payment for a new vehicle rose another $15 in the last year, hitting an all-time record high of $523, according to a report from the credit reporting agency Experian. 72-month loans continue as the most common term length, but lenders are starting to dip into the 85 to 96-month bucket to help consumers who want to keep their monthly payments as low as possible.
In the company's newly released "State of the Automotive Finance Market Report," Experian says the average new vehicle loan amount also hit a new record of $31,455 over the first quarter of 2018, sharply increasing $921 from the previous year. They also reported that the average interest rate during the same timeframe was 5.17 percent for new vehicle loans.
"The dream of owning a new vehicle is becoming more elusive to the average American," said Melinda Zabritski, Experian's senior director of automotive financial solutions in a news release. "To reverse the trend, dealers and lenders need to better understand the data and explore different options to make new vehicle ownership accessible and appealing."
Despite the spike in loan amounts, payments and interest rates, Experian reports that 30-day delinquencies have dropped during this period to 1.90 percent, while 60-day delinquencies have remained flat at 0.67 percent. For a new vehicle loan, the average credit score now stands at 716.
"Traditionally, lenders' risk tolerance has swung back and forth like a pendulum, and right now we're seeing a more risk-averse side. But if payments continue to improve, we could see credit standards loosen," according to Zabritski.
If that wasn't enough records for one quarter, Experian also says that used vehicle loans for the first quarter came in at a new all-time high of $19,536, and the total amount of outstanding loan balances hit its own record at $1.108 trillion.