US Prime Auto Loan Performance Weakens Further in June
Further signs of weakness in the US car loan sector are evident in Moody’s latest auto loan indexes.
Prime auto loan credit performance deteriorated in June 2008 as net loss and delinquency rates increased compared to year-ago levels. Moody’s prime auto loan net loss rate rose to 1.24% in June 2008, an increase of 87% from the level of 0.66% during June 2008, a 18% increase from its year-ago level of 0.46%.
The Manheim Used Vehicle Value Index, an indicator of recovery values on repossessed vehicles, dropped 4% during June 2008 from the year-prior level. Lower prices for used vehicles lead to lower recovery rates on repossessed autos, thus increase loss severities.
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