CHICAGO and CINCINNATI -

As TransUnion projected that new-vehicle leasing volume should continue to strengthen, Swapalease.com reported that lease credit approvals improved slightly as 2013 closed.

The site determined December’s approval level came in at 73.3 percent, compared with the November reading of 70 percent.

Officials noted the overall approvals rate on the year finished at 72.7 percent, compared with a 2012 rate of 65.3 percent.

Swapalease highlighted that holiday lease shopping from a higher population of well-qualified lessees helped improve the credit approval rate from November when just 70 percent of applicants were approved.

Prior to December, the site pointed out, the lease credit approval rate had slipped to 67.9 percent, and Swapalease executives believed a higher volume of less-than-ideal credit shoppers were placing stress on the approvals rate.

Historical marketplace trends show that a 70-percent credit approvals rate is considered healthy for Swapalease.com.

The site metioned the approvals rate had jumped as high as 76 percent in June of 2013 before dipping back down, mostly as a result of a higher influx of younger drivers dealing with high levels of student loan debt.

Swapalease executive vice president Scot Hall reiterated that credit is the lifeblood of leasing, and the lease company must approve of all incoming lessees before a transfer can complete in the marketplace

“We anticipated that 2013 would outperform 2012 levels due to the rising health of the automotive industry and overall economic conditions that continue to improve,” Hall said.

“The appetite for leasing should remain solid in 2014, and we believe we will maintain several months of healthy approvals activity, pending unforeseen economic climate conditions,” he continued.

In a separate interview with sister publication SubPrime Auto Finance News, Peter Turek wasn’t ready to go so far as to declare that new vehicles are predominantly going to be tied to a lease contract while a used vehicle is going to be connected to a retail installment deal. Turek is automotive vice president in TransUnion’s financial services business unit.

“I don’t know if this is the new normal but clearly there is an opportunity here for consumers that are aspirational or manufacturers that want to move new product to use leasing as a way to get those new vehicles out into the market,” Turek said.

Nonetheless, TransUnion data showed that leasing may play a greater role in the industry during 2014.

The number of leases issued since the recession ended in 2009 has steadily climbed. In the first six months of 2009, approximately 500,000 auto leases were issued. Three years later, this number doubled to 1 million leases for the first six months of 2012.

This number increased further in 2013, with more than 1.3 million auto leases issued in the first six months of the year.

“We expect the number of leases to continue to rise as a percentage of all auto loans in 2014,” Turek said. “This will likely help keep auto loan delinquencies low, as leases are generally issued to consumers with a higher VantageScore credit score.

“Overall, the increased demand in both new and used vehicles has allowed dealers and lenders to match consumers with the right vehicles and loan terms,” he continued.

TransUnion also projected that auto loan debt per borrower is also expected to jump more than $1,000 from a projected $16,942 in Q4 2013 to $17,966 in Q4 2014.

As TransUnion projected that new-vehicle leasing volume should continue to strengthen, Swapalease.com reported that lease credit approvals improved slightly as 2013 closed.

The site determined December’s approval level came in at 73.3 percent, compared with the November reading of 70 percent.

Officials noted the overall approvals rate on the year finished at 72.7 percent, compared with a 2012 rate of 65.3 percent.

Swapalease highlighted that holiday lease shopping from a higher population of well-qualified lessees helped improve the credit approval rate from November when just 70 percent of applicants were approved.

Prior to December, the site pointed out, the lease credit approval rate had slipped to 67.9 percent, and Swapalease executives believed a higher volume of less-than-ideal credit shoppers were placing stress on the approvals rate.

Historical marketplace trends show that a 70-percent credit approvals rate is considered healthy for Swapalease.com.

The site metioned the approvals rate had jumped as high as 76 percent in June of 2013 before dipping back down, mostly as a result of a higher influx of younger drivers dealing with high levels of student loan debt.

Swapalease executive vice president Scot Hall reiterated that credit is the lifeblood of leasing, and the lease company must approve of all incoming lessees before a transfer can complete in the marketplace

“We anticipated that 2013 would outperform 2012 levels due to the rising health of the automotive industry and overall economic conditions that continue to improve,” Hall said.

“The appetite for leasing should remain solid in 2014, and we believe we will maintain several months of healthy approvals activity, pending unforeseen economic climate conditions,” he continued.

In a separate interview with sister publication SubPrime Auto Finance News, Peter Turek wasn’t ready to go so far as to declare that new vehicles are predominantly going to be tied to a lease contract while a used vehicle is going to be connected to a retail installment deal. Turek is automotive vice president in TransUnion’s financial services business unit.

“I don’t know if this is the new normal but clearly there is an opportunity here for consumers that are aspirational or manufacturers that want to move new product to use leasing as a way to get those new vehicles out into the market,” Turek said.

Nonetheless, TransUnion data showed that leasing may play a greater role in the industry during 2014.

The number of leases issued since the recession ended in 2009 has steadily climbed. In the first six months of 2009, approximately 500,000 auto leases were issued. Three years later, this number doubled to 1 million leases for the first six months of 2012.

This number increased further in 2013, with more than 1.3 million auto leases issued in the first six months of the year.

“We expect the number of leases to continue to rise as a percentage of all auto loans in 2014,” Turek said. “This will likely help keep auto loan delinquencies low, as leases are generally issued to consumers with a higher VantageScore credit score.

“Overall, the increased demand in both new and used vehicles has allowed dealers and lenders to match consumers with the right vehicles and loan terms,” he continued.

TransUnion also projected that auto loan debt per borrower is also expected to jump more than $1,000 from a projected $16,942 in Q4 2013 to $17,966 in Q4 2014.