SCHAUMBURG, Ill. (3/4/16)--The average amount financed and the average monthly payment for a new vehicle continues to increase, surpassing previous highs, according to Experian Automotive.
The average amount financed for a new vehicle in was $29,551 in the fourth quarter of 2015, up $1,170 from the same period in 2014, and the average monthly payment rose to $493, an increasefrom $482 in the same time period.
“People shop for vehicles largely based on monthly price, and right now, average dollar amounts for new vehicle loans are soaring,” said Melinda Zabritski, Experian Automotive senior director of automotive credit. “In order to stay within their budget goals, we have seen that more consumers--even those within the prime and super-prime risk categories--are turning to leasing and used vehicles as cost-effective alternatives to buying new.”
The average lease payment was $412 (versus the average loan payment of $493) during the fourth quarter of 2015. Due to the significant monthly savings, leasing reached another record high of 33.6% of all new financing during the quarter.
Used vehicle loans made up 62.8% of all vehicle financing, and the average amount financed for a used vehicle during the quarter was $18,850. Additionally, the average monthly payment for a used vehicle was $359, bringing the gap between new- and used-vehicle monthly payments to an all-time high of $134 in the fourth quarter of 2015.
“Over the course of the last few years, we have seen the market stabilizing nicely,” Zabritski said. “Credit scores are flattening out for new vehicle financing and more prime consumers are shifting to used, which is helping increase the average score there as well.”
Overall, the report shows that average credit scores across the board have flattened in the past few years. The average credit score for a new vehicle loan was 711, down from 712 in fourth quarter of 2014. Average credit scores for new vehicles peaked at 736 in 2009, then dropped 25 points from 2009 to 2015 as the market recovered from the recession. However, in the past six years, average credit scores for new vehicle loans have dropped by only four points each year.