In the third quarter of this year, the average loan for a new vehicle jumped $1,080 dollars to $27,799, while the average used vehicle loan climbed to $18,576, according to the report.
With auto prices and loans moving higher, more Americans are turning to leasing and extended loans in order to keep their monthly payments as low as possible. Experian says the average amounts financed for both new and used vehicles are at all-time highs.
The fact Americans are borrowing more than ever to buy a vehicle is not surprising, since the total price being paid at dealerships has been steadily climbing to record levels. That amount now tops $31,000 for new vehicles.
Experian, which tracks new and used vehicle loans, says the average monthly payment for new vehicle loans increased $12 to $470 in the third quarter. The average used vehicle loan reached an all-time high of $358
Meanwhile, long-term auto loans are under increasing scrutiny. Experian says almost a quarter of all new vehicle loans were for six and a half to seven years in length, a 23.7 percent increase from the previous quarter.
Paying off auto loans over a longer period has become more popular because it lowers the amount of the monthly payment. However, the benefit of lower payments means it takes longer for borrowers to reach positive equity in their vehicles.
Experian says the growth in auto loans has lead to an increase in the number of auto loans in delinquency. Still, just 0.62 percent of all auto loans were delinquent for 60 days in the third quarter according to the report. .