Auto Loan Rates for the Week Ending July 10, 2009

The bleak economic data produced during the week was the foundation for enough movement in the bond market to affect mortgage rates and bank rates but car loan rates held stubbornly steady.  This week bond rates dropped noticeably as did the rates paid on bank certificates of deposits and savings rates.  Unfortunately, that activity had little impact on car loan rates. 

Auto loan rates were little changed for the week ending July 10, 2009.  Long term auto rates for new cars rose modestly while the shorter term auto loan rates remained constant.  Used car loan rates displayed a similar pattern.  Long term used car loan rates rose modestly while the shorter term rates were mostly unchanged.

The average of the top ten car loan rates with a 60 month term moved up by one basis point or 1/100 of a percent to end the week at 5.74%.  The average for the 48 month term car loan rate was up by one basis point as well, closing out the week with an interest rate of 5.63%.  36 month car loan rates remained stationary ending the week at 5.49%. 

In the used car loan rate category, the 60 month term used car loan rate increased by two basis points to 6.14% for the week.  The 48 month used car loan rate was unchanged at 5.84%.  The short term, 36 month term used car loan rate moved in the opposite direction and fell one basis point to end at 5.73%. 

With car loan volume off significantly this year, the big lenders are busy working mortgage origination’s and dedicating limited resources to auto financing.  Fortunately for the big banks, the cost of funds for lending is dropping the year and with almost no comparable reductions in car loan rates, the big boys should enjoying a large spread on car loan interest margins.  Auto loan rates should move lower in this environment but with the loan losses the large lenders are experiencing in credit cards and mortgages, the odds of seeing any banking generosity in 2009 with lower car loan rates appears remote.

Tags: auto financing, auto loan rates, auto loans, bank rates, car loan rates, car loans, used car loan, used car loan rates

This entry was posted on Monday, July 13th, 2009 at 7:45 pm and is filed under Auto Industry Update. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.