The average loan amount for a new vehicle reached a record of $30,621 in the fourth quarter, Experian said Thursday. The average loan amount for a used vehicle also reached a record, from $18,850 in the fourth quarter of 2015 to $19,329 in the same period in 2016. The report also showed more buyers went for longer-term loans: the number of consumers opting for auto loans with terms of 73 to 84 months on their new vehicles increased from 29% in the fourth quarter 2015 to 32.1% in the fourth quarter. In the used car market, there was an increase in 73- to 84-month loans from 16.4% in the fourth quarter of 2015 to 18.2% in the same quarter in 2016. The need for affordability drives consumer purchasing behavior, Melinda Zabritski, Experian's senior director of automotive finance, said in a statement. There's an $11,000 gap between the average loan amount on a new and on a used vehicle, the widest Experian has recorded, she said. "This upward trend is causing many consumers to find alternative methods like extending loan terms, getting a short-term lease or opting for a used vehicle to get what they want while staying within their monthly budget," Zabritski said.
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