PIN: Longer Loans Continue to Gain Popularity
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WESTLAKE VILLAGE, Calif. — In its latest market analysis, Power Information Network reported that the retail auto business is continuing to embrace longer loans.
"Six-year loans (taken out at the dealership) now account for four of every 10 new-vehicle loans, almost double the mix five years ago," the J.D. Power and Associates affiliate indicated.
Additionally, the company found that, "The mix of seven-year loans has more than doubled since 2005, and they now account for more than one of every 25 new-vehicle loans."
And apparently, the non-captives are driving the longer loans. The captives are heading in the same direction; however, they're behind by about two to three years, PIN officials pointed out.
"Among the non-captives in 2008 to-date, the total of five-, six- and seven-year loans has accounted for 87 percent of all new-vehicle loans," according to the report.