Average New Vehicle Auto Payment Hits Record High $523 Per Month

  • Print

The average size of a loan for a new car in the US set a record in the first quarter as did the average payment.

Database firm Experian notes US Monthly Auto Payments Reach Record High in First Quarter.

  • New vehicle loans averaged $31,455
  • The average monthly payment for a new vehicle hit at a record $523/month
  • Consumers are lengthening loan terms, with six years being the most common, to adjust to the higher costs and rising interest rates.
  • Outstanding loan balances reached a record high of $1.108 trillion
  • Loans for used vehicles reached $19,536, also a record

Auto Math

$523 * 12 * 6 = $37,656

That total does not factor in the down payment.

Interest = $37,656 - $31,455 = $6,201.

That's $1033.50 in interest annually.

Lovely.

At the end of six years, perhaps the car will fetch $5,000 in a trade-in, but everything depends on miles, damage, and of course advancements in self-driving.

Anyone trading the car in after three or four years will be hugely underwater.

The dream of owning a new vehicle is becoming more elusive,” said Melinda Zabritski, senior director of automotive financial solutions at Experian.

Elusive Dream?

light weight vehicle sales

Ah, the dream of spending $30,000 to $50,000 on a depreciating asset.

Elusive has not yet arrived, but it will.

CLICK HERE to subscribe to the free weekly Best of Financial Sense Newsletter .

About Michael Shedlock

Quantcast