Interest rates will begin to rise along with demand for new vehicles.
Portland, Oregon (PRWEB) December 12, 2013
According to Experian Auto, this year has seen the lowest interest rates on record. For the last six months, borrowers with good credit have been able to secure auto loans with as low as 4.5% interest. The average borrower pays less in interest on current car loans than in any year since 2008. Complete Auto Loans issued a prediction today that the market had reached its bottom and that interest rates will slowly begin to climb throughout the next year.
Complete Auto Loans calculated that borrowers can save up to $1,000 (depending on car model and length of loan) for every percentage point under 8% that their loan is. In the height of the economic boom in the early 2000s, the auto market saw interest rates jump to as much as 13% because of the surging demand for automobiles. Far from being another financial bubble, this year’s recovery in the auto sector is one of the true ‘miracle’ stories to come out of the recession. Sales of nearly every single vehicle type are up over the last five years, and they show every sign of increasing thanks to increased consumer spending and better loan options.
Complete Auto Loans analyzed a variety of market factors to come to its conclusion, including the uptick in numbers of cars sold and the increase both in loan terms and average quantity of debt per borrower. According to Rob Kaiser, analyst at Complete Auto Loans, “Right now the lending market is still operating as though the economy was in recession. Record low interest rates have clearly been successful at bringing in new business to auto dealers across America, and it is only a matter of time before the momentum causes interest rates to rise along with demand for new and used vehicles.”
Complete Auto Loans is quick to remind borrowers that low interest rates will likely be gone by February, so now is the perfect time to take advantage of loan offers on new or used cars. With lower monthly payments and a lower overall debt burden, there is nothing about lower interest rates that merits passing them up for yet another year.