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Auto loan delinquencies decline due to increased consumer confidence

Jun 07, 2011 Brian Bradley

As some consumers begin to climb out of debt following the recession, paying auto loans has become less of a burden. According to data from consumer credit reporting company TransUnion, 60-day auto loan delinquency rates recently hit their lowest levels since 1999, at 0.49 percent. The drop has been fueled by stronger consumer confidence combined with lower interest rates, which has made financing an automobile more feasible. "Continued improvement in auto delinquencies is a reflection of the stronger auto sales market," said Peter Turk, automotive vice president of TransUnion's financial services business unit. "As consumers' confidence in the economy improves, and with auto loan rates remaining at relatively low levels, more people are making auto purchases." The Honolulu Star-Advertiser reports that in Hawaii, auto loan delinquencies fell by 46 percent year-over-year in the first quarter of 2011, to 0.42 percent of total loans - seven points better than the national average. Nationally, auto loan delinquencies fell 17 percent during the same time period. However, Hawaii also had a large average automobile debt burden at $14,281 - second only to Washington, D.C., where the average is $16,268.