December 19, 2016
www.usedcarnews.com
2016 MOVERS AND SHAKERS
Chuck Bonanno
Mike Browning
Mike Dewine
The veteran buy-here, pay-here consultant
As president of the National Auto Auction
The Ohio attorney general continued as one
joined the National Independent Automobile
Association, Browning oversaw the group’s
of the most active prosecutors in the nation
Dealers Association late last year as national
inaugural presentation of Auction of the Year
when it came to going after used-car dealers.
director of twenty groups and seminars for
award, recognizing auctions that give back to
DeWine filed suit against eight dealers in
NIADA.
their communities. That’s a topic Browning
the past year. On May 26, DeWine announced
learned about first-hand when he was general
he would seek the Republican nomination for
manager of Manheim New Orleans in 2005.
governor of Ohio in the 2018 election.
Bonanno’s hire was part of NIADA’s acquisition of Leedom & Associates LLC.
Creditors Tighten As Delinquencies Rise However, the New York Fed’s analysis shows an underlying problem in those numbers. The 90-plus day delinquency rate for auto finance companies worsened by a full percentage point over the past four quarters, while delinquency rates for bank and credit unions improved slightly. Finance companies focus more on subprime consumers, most of whom are buying used vehicles. “The worsening in the delinquency rate of subprime auto loans is pronounced, with a notable increase during the past few years,”
states a recent blog post by the New York Fed. Experian also sees an increase in 60-day delinquencies, but the firm reports that financing for subprime consumers fell in the third quarter for both new and used sales. The steepest drop came at the lowest end of the spectrum. Financing for deep-subprime new-car buyers dropped to the lowest level since 2011 and for used buyers it was the lowest Experian recorded since tracking began in 2007. The average credit score for new-
car buyers climbed to 712 in the third quarter, marking the first time average credit scores for new vehicle loans rose since hitting a record high of 723 in the second quarter of 2012. For used vehicle buyers, the average credit score jumped five points to 655. “For anyone making doomsday predictions about a subprime bubble in the auto industry, the third quarter provides a stark reality check,” said Melinda Zabritski, Experian’s senior director of automotive finance.
Rush - Dated Material
A recent uptick in delinquencies for subprime auto finance is raising some concerns, but finance sources appear to have already taken steps to avoid larger problems. Auto loan originations in the third quarter remained at the high levels seen over the past six quarters and comparable to the peak seen one year ago, the Federal Reserve Bank of New York reports. Despite the increase in originations, the overall 90-plus day delinquency rate for auto loans increased only slightly through the end of September to 3.6 percent.
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