Fed Reports on Latest Consumer Credit Information
WASHINGTON, D.C. — Although preliminary data on the average annual percentage rate for new-car loans financed through auto finance institutions has slowly crept up in recent months, it still remains in the 5th percentile, coming in at 5.37 for July, up slightly from 5.30 in June. Meanwhile the median length of an auto loan actually shortened slightly to 61.1 months from 61.2 in July, according to data released from the Federal Reserve Board earlier this month.
The loan-to-value ratio has also changed a bit from June, coming in at 88 for July, compared to 89 in June. In May this statistic was 91, and it was reported at 90 for the second quarter of the year.
As for the average amount financed for a new auto loan by auto finance companies, this statistic has dropped of late, with preliminary Federal Reserve data showing it coming in at $26,059, compared to $26,126 in June. However, according to recent statistics, consumers still financed more in June and July than in May and the second quarter of the year. The median amount financed in May came in at $24,788, while the average amount financed in the second quarter was $25,300.
When it comes to the average interest rates provided by commercial banks for 48-month new-car loans, the Federal Reserve Board said data wasn't available for June or July. However, the statistic was 7.53 in the second quarter and remained at that level for May. In the first quarter of the year, the average interest rate by commercial banks was 7.39.
Looking at non-revolving credit, including auto loans and all other loans not included in revolving credit, such as loans for mobile homes, education, boats, trailers or vacations, which may be secured or unsecured, the percentage change in the annual rate was reported as 2.5 percent. In June this number was 4 percent, and it came in at 5.5 in May.
"Consumer credit increased at an annual rate of 2 3/4 percent in July," explained the Federal Reserve Board. "Data for finance companies have been revised from June 2000 going forward. This revision boosted the annual growth rate of total consumer credit about 1 1/4 percentage points from 2001 to 2005."
The board noted that the finance company revision was a result of benchmarking to the 2005 quinquennial finance company survey.