ARLINGTON, Va. — Reflecting the current economic landscape, the Consumer Bankers Association's 2008 Automotive Finance Study found that delinquencies climbed 6 percent for new vehicles and 13 percent for used.

While the study generally focuses more on the prime credit spectrum rather than non-prime, it is still indicative of what the marketplace is doing.

For non-prime and subprime analysis, the National Auto Finance Association releases an annual report around the time of its Non-Prime Auto Financing Conference, which will be held June 4 to 6. (Stay tuned to SubPrime Auto Finance News for coverage from this event and the results from the non-prime study).

The CBA's study is based on an analysis of 2007 year-end data that is performed by Benchmark Consulting International.

"Net losses, although still manageable, are double the rate from last year," Rich Apicella, auto finance practice executive with Benchmark Consulting International, explained to SubPrime Auto Finance News this week. 

"Moreover, the repossession rate is now greater than 2 percent of units, with the average loss per unit of more than $8,000," he added. 

Interestingly enough, the average credit score for a new-vehicle buyer was down 31 points.

More specifically, the average origination FICO for new vehicle buyers came in at 709 at 2006 year-end, and in 2007, it was 678.

Look-to-book was 25 percent (both new and used) in 2006, compared with 29 percent in 2007 for new vehicles. Account delinquency reached 1.15 percent last year, compared with 1.09 percent in 2006 for new units.

Average term was 64 months in 2006 versus 65 months in 2007. Meanwhile, loan-to value came in at 97 percent last year, as opposed to 95 percent in 2006 for new vehicles.

The amount financed on new vehicles decreased to $24,297 in 2007 when compared with $25,179 in 2006.

On the used-vehicle side, buyers' origination FICO came in at 689 for 2007, compared with 690 in the previous year.

Look-to-book was 23 percent in 2007 versus 25 percent (new and used). Additionally, account delinquency came in at 2.30 percent for used vehicles last year, compared with 2.03 percent the year prior.

The average term came in at 62 months, as opposed to 61 months in 2006. Moreover, loan-to-value was 100 percent in the most recent results, compared with 99 percent in 2006.

Median amount financed for a used vehicle grew to $17,900 in 2007 versus $16,750 in the previous year. 

Overall, Apicella indicated that average loan terms and LTVs climbed, albeit less dramatically than the prior year.

"The results of the survey were not very surprising to the CBA audience; they are reflective of the credit crunch cycle that the auto finance business is currently experiencing," he stated.

In another interesting trend, dealers utilizing application entry portals jumped 69 percent over the prior year to 78 percent; however, fax/phone and Web still took first place at 81 percent.

Basically, the data for this survey was submitted in January and February of this year, based on 2007 year-end results.

The breakout included class size defined as small, up to 100,000 accounts (11 participants); medium, from 100,000 to 300,000 accounts (eight); and large, greater than 300,000 accounts (13).

The credit spectrum breakdown was:

Super Prime: greater than 720

Prime: 680 to 720

Near-Prime: 620 to 679

Non-Prime: 550 to 619

High Risk: Less than 550


For the complete study, including more results, visit