Second quarter auto loan delinquencies decrease

The amounts of auto loan delinquencies continued to fall in 2012's second quarter, following a drop in the first quarter's rate. Industry experts believe this is an indication of improving economic conditions as both consumers and financial institutions, including short term lenders, are becoming more confident in the market. According to a quarterly survey by TransUnion, delinquency rates across the nation decreased from this year's first quarter total of 0.36 percent to 0.33 percent in the second quarter. The rate last year during the same period was 0.44 percent. Regions throughout the country have seen a drop in the amount of delinquencies, as 58 percent of metropolitan areas experienced a decrease in late auto loan payments during the second quarter. TransUnion executives stated that the recent numbers highlight the fact that consumers want to establish and keep their lender relationships strong. Banks and other financial institutions are also increasing their lending efforts, especially to subprime borrowers, as more businesses are relying on alternative credit data to determine creditworthiness. The Wall Street Journal cites research by a leading credit reporting bureau which found that companies extended a total of $228.4 billion in auto loans during 2012's first quarter, representing a $2 billion rise from the previous quarter.