TransUnion says that car loan late payments are down

Some much-needed good news has come down the vehicle industry news expressway, reports the Wall Street Journal. Credit agency TransUnion has conducted a study indicating that car loan delinquency percentage of 60 days or more has fallen noticeably in the past 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.

Buyers who grow to be frugal slow the transformation

Fewer consumers are 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 transformation. Peter Turek of TransUnion recognizes a silver lining to the economic dark cloud when it comes to the diminished delinquency rate.

”Although part of the reason for the transformation in late payment percentage is the influence of new, lower risk loans, consumers do not see a quick fix to the short-term economic and employment situation,” exclaimed Turek.

Quarter 2 final results were 20 percent much better than Q1

Consumers 60 days late or more on their auto loans fell by .53. According to the Journal, this was a 20 percent over Quarter 1 late payment rates. That’s the largest decrease since summer 2001, writes the Wall Street Journal. Vermont came out on top when it comes to most improved payees, when Rhode Island, Utah and Montana came out on the bottom. A near 50 percent drop in Vermont (from 1 percent to .58 percent) is definitely good news. On a parallel note, Hawaii’s rate of loan origination was lowest in the study. Milking old cars for anything they’re worth is probably less costly than purchasing a gallon of milk in Hawaii, anyway.

By the fourth quarter of 2010, nevertheless, TransUnion is predicting a .6 percent increase in delinquency. Thus, enjoy the great news while you can. The probable cause would be the predicted weight of holiday spending.

Additional reading

Wall Street Journal

online.wsj.com/article/BT-CO-20100830-703526.html