Experian Automotive has released a new report that shows that car buyers are now taking out more auto loans to purchase used cars than to buy new vehicles. This trend even extends to those who have excellent credit scores and spotless credit records. In the second quarter of this year, more than 43 percent of auto buyers with high credit purchased a used car with a loan. This is an increase of ten percent from Q2 2015.
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Those with outstanding credit were not the only ones who were looking to buy used vehicles. Almost 60 percent of those who were ranked in the prime category chose to purchase a used car rather than a new one. This represents a 6.6 percent increase on Q2 2015.
Experian attributes this trend to the increase in the average price of a new vehicle. The costs of many new cars are now reaching record highs, with people paying $34,000 or more. This means that the values of auto loans are also increasing, with the average loan currently at almost $30,000. Those borrowing to purchase a used car, on the other hand, borrow less than $20,000 on average.
This price difference has led to an increasing number of loans being written for used cars. A total of 55.6 percent of auto loans made in this year's second quarter were for previously-owned vehicles, which set a new record for used car loans.
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This article was provided by our partners at moneytips.com.