It appears more motorists are paying down their car loans, as a new report from the credit monitoring agency TransUnion indicates auto delinquency rates fell for the seventh-straight quarter.
Though the delinquency rate in the second quarter was expected to decline, Peter Turek, automotive vice president for TransUnion, said the dropoff has been larger than anticipated.
"With auto sales improving, more auto loans are opened by consumers placing downward pressure on auto delinquency rates," said Turek. "A consumer's ability to repay is also helped by the recent low interest rates for new and used car loans, making purchase decisions and monthly payments more affordable."
Turek added that the report is a benefit to lenders and car dealerships, but also to consumers in general, as they may be offered more reasonable financing options.
The report also detailed the states where delinquencies were the least and most common. Idaho, Vermont and Montana had the lowest rates, while Mississippi, Louisiana and Tennessee had the highest.
Missing car payments can adversely affect consumers' ability to borrow at a low interest rate. However, consumers who make their payments on time may also be impacted due to errant markings made by creditors. To avoid a bad credit report, individuals should review their financial history and schedule a meeting with a credit repair company if anything appears incorrect.