TransUnion released a forecast on Monday concluding that 2014 will be a mixed bag for automobile lenders, with both delinquency rates and loan balances expected to rise. The auto loan delinquency rate has been steadily increasing since hitting a post-crisis low in mid-2012, and TransUnion expects the slow climb to continue next year.
The credit bureau projects the rate of borrowers 60 or more days past due to rise to 1.19 percent by the end of 2014, from an estimated 1.10 percent at the end of this year. The delinquency rate bottomed out at 0.86 percent in the second quarter of 2012, and peaked at 1.59 percent in the fourth quarter of 2008. While the rise in delinquency rates should be modest, total auto debt per borrower will increase significantly, to $17,966 at the end of 2014 from $16,942 at the end of 2013, according to TransUnion's forecast. The projected 6 percent increase would be greater than the year-to year rise in each of the last three years.