Auto Lending Numbers

Not all car loans are prime loans, many are non prime and we about them as though they were not a large portion of the lending numbers. However, around 20% of the car loans issued today are non prime. That works out to roughly $50 billion worth of car loans that originated at dealerships that are non prime.

A new report by the Power Information Network, a subsidiary of J.D. Power and Associates, says that indirect car loans and leases are about three of every four car loans that were issued last year. The company also gives us the above facts in relation to how many of the non prime car loans were out there.

Non prime loans for last year were roughly 61 months per term (as opposed to 56 months for prime), had down payments of about 11.6% (as opposed to 17.4% for prime), and had higher loan to value ratios as well. Their LTV ratios were about 108.6% - while prime customers’ were around 96.8%.

The report also says that there are more compact cars for non prime loans than for prime car loans, adding up to about 26% of the cars out there for their car loan category. Less than 7.5% of non prime car loan borrowers bought a full sized car.
 

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