https://www.autocreditexpress.com/blog/transunion-subprime-loan-originations/
The TransUnion report showed that, overall, auto loan originations were down 0.2%. However, subprime loan originations dropped 5%, which is huge when talking about numbers of this scale.
Additionally, TransUnion reported that delinquency rates are on the rise. Auto finance delinquency rates increased to 1.30% in the first quarter of 2017, compared to 1.16% a year earlier. The bureau attributed this to poor payment performance by the subprime and near prime segments.
So, the two main takeaways from the report are: (1) fewer auto loans are being approved, especially in the subprime segment, and (2) delinquencies have ticked up. This combination could mean more changes are coming.
“Regardless, with flatter sales volumes and higher delinquencies, we anticipate lenders will evaluate their credit policies for subprime and near prime borrowers to calibrate for the uptick in delinquencies,” said Brian Landau, TransUnion’s senior vice president for financial services.
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