Auto-loan delinquency rates inched up in the first quarter, due largely to an increase in subprime loan balances, according to a new report.
The percentage of loans 60 or more days past due ticked up to 0.88% in the first quarter of 2013, according to a report from the credit agency TransUnion. That's up from 0.82% in the first quarter of last year, but down from 1.00% in the fourth quarter of 2012.
A rise in the delinquency rate of subprime borrowers was the main driver of the year-over-year increase. The subprime delinquency rate was 5.50%, up from 5.09% in the first quarter of 2012.
Subprime loan balances also continued to rise, increasing 6.6%, to just over $12,000, compared to the first quarter of 2012. The average balance for all borrowers rose for the eight consecutive quarter, to $13,260, a 4% rise compared to the same period in 2012.
"We've been monitoring the auto loan landscape closely for some time to see if increased subprime lending would start pushing delinquency rates up," Peter Turek, vice president of TransUnion's automotive division, said in the news release. "We found that while subprime borrowers are receiving more auto loans, the percentage of these loans to all auto loans made remains the same as last year so there has not been a dramatic effect to the overall delinquency rate."
Subprime borrowers represented 15% of all borrowers, the same percentage as one year ago. The percentage of subprime lenders has steadily declined from a peak of 20.3% in the first quarter of 2009.
This latest TransUnion Industry Insights Report covers auto loans originated by all lenders; in February, the company reported that the delinquency rate for loans originated by banks was 0.41% in the fourth quarter of 2012. Information on delinquency rates for bank-issued loans was not available for the latest survey, a spokeswoman said.