Auto loans rise rapidly with sales
Posted on Thursday, July 16, 2015 at 2:27:25 PM
Since a 2009 nadir, auto sales in the U.S. have made a recovery with a bullet, and with that auto financing rates have also risen sharply.
Auto sales reached a recovery high of 17.7 million in May, followed by 17.1 million in June, according to See It Market - each not far from the seasonally adjusted annual rate peak of 20.6 million units in July 2005. The two-month rolling average was 16.8 million, also a recovery peak.
Auto financing has risen at a similarly rapid rate since the start of the recovery. In the third quarter of 2010, auto loans were at $698 billion, the news source explained. And by the first quarter of 2015, that figure had risen to $972 billion.
J.P. Morgan & Co, and Wells Fargo & Co. each revealed as much in their latest earnings reports, both of which showed auto loan growth in the second quarter, according to Business Insider. Timothy Sloan, CEO of Wells Fargo, which lent $3.7 billion to finance vehicles last quarter, credited the 7 percent year-over-year growth his bank saw to a "strong auto market."
While auto loans still make up a small share of the loan market, they are increasing at a rapid rate at this point in the ongoing recovery.