The value of used cars is skyrocketing, resulting in

0
53

[ad_1]

AUSTIN, TX, June 22, 2021 (GLOBE NEWSWIRE) – RateGenius, one of America’s largest auto loan providers with over 150 lender partners nationwide, today released new report study of the impact of rising prices for used cars on the authorization of refinancing car loans in the customer base of RateGenius. The report concludes that the odds of approval for US borrowers are better today than ever – 66% more since May 2020 – giving consumers a strong case to get a refinancing loan while the circumstances are in their favor.

“Consumers should take advantage of this market sooner rather than later and refinance their car loan while conditions are still so favorable,” said Christopher Spelz, CEO of RateGenius. “It is difficult to predict how long the current shortage of semiconductor chips and the small number of new cars will last, so we urge consumers to make the most of this opportunity to refinance and optimize their auto loan savings.”

RateGenius associates an increase in the chances of a refinancing loan with an increase in used car prices, which is caused by a combination of:

  • IN Semiconductor Lack of chip: As a result of the COVID-19 pandemic, automakers canceled orders for semiconductor microchips, not anticipating new demand for cars, but the opposite scenario unfolded, resulting in a serious shortage of microchips, in particular from the American companies Ford and General Motors.
  • The stock of used cars is low: With fewer new cars available for purchase, it has become more difficult to find used cars, leading to inventory shortages across the country.

The report examines several factors affecting auto refinancing loans, with the rise in the value of used cars playing an important role. As the value of used cars has increased, the credit-to-value ratio, or LTV, has declined, which means that the consumer’s cars are likely worth more than the value of their loans. This has led to the perfect storm for consumers to refinance their car loans.

This is great news for consumers who may not have been able to get permission to refinance their auto loans just a few months ago. It also means that consumers with strong applications (large credit, stable income, low debt, etc.) can get even better credit conditions. This trend is widespread.In May 2021, the number of authorized loans for refinancing cars increased by 37% compared to January 2020, by 14% compared to January 2021 and by 66% compared to May 2020.

Below are some of the key findings from the report:

The cost of used cars

  • Among the popular car brands and models refinanced by RateGenius, the 2017 Ford F-150 pickup increased by $ 10,475 (+ 40%) from May 2020 to May 2021.
  • The next largest percentage increase was the 2017 Nissan Rogue. The cost of the SUV increased by $ 3,775 (+ 30%).
  • The 2017 Honda Civic Sedan increased by $ 3,800 (+ 28%), followed by the 2017 Jeep Wrangler, which saw the second highest average cost gain, $ 6,325, but the smallest overall gain (+ 25%).

Loan to cost ratio

  • The average ratio of retail loans to value for all auto refinancing applications in May 2021 was 102%, which is the lowest ever.
  • Last month, average retail LTV was 26% lower than January 2020, 18% lower than January 2021, and 27% lower than May 2020.

About RateGenius
RateGenius is a technology company that has created its own web platform that has helped hundreds of thousands of consumers across the country refinance car loans on better terms. Using its network of more than 150 lenders, RateGenius has successfully disbursed over 375,000 loans worth over $ 8 billion. The proprietary LOS (Credit Disbursement System) system, educational content and a customer experience-driven business approach have been instrumental in its success. The RateGenius online app is fast, simple and affordable from the comfort of your home. apply.rategenius.com

Media contacts
Corbin Michelich
CSG
316-209-9794
cmihelic@wearecsg.com

A photograph accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/ea369685-b16f-4cc5-a7d4-cb87eeb172a9

[ad_2]

Source link