Data from Experian Automotive shows loan amounts are hitting record highs as U.S. consumers rely more heavily on financing to purchase their next vehicles.
The company’s latest study revealed new vehicles purchased with financing in the fourth quarter of 2014 is now up to 84 per cent, with the average loan amount hovering around $28,381 U.S. — a $950 increase from a year ago and a $582 increase from the third quarter of 2014.
The average monthly payment for a new vehicle hit $482 — the highest level according to Experian’s data.
Used vehicle financing has also reached a record high of 55.2 per cent, with the average loan now around $18,411 U.S., up $437 from 2013.
“In most parts of the country, vehicles are viewed as a necessity to everyday life, which is why we continue to see consumers willing to take out larger loans as the average price of vehicles continues to rise,” said Melinda Zabritski, senior director of automotive finance, Experian Automotive, in a press release.
The report also shows leasing has continued to gain traction, jumping 3.6 per cent from a year ago to nearly 30 per cent of all new vehicles financed in the fourth quarter. The average monthly lease payment is $408 in the fourth quarter, decreasing about $12 from 2013.
