TransUnion Uncovers Unique Dynamic
A new TransUnion study reinforced an intuitive belief risk management departments at vehicle finance companies might already have had: Consumers with the ability to pay larger amounts than the minimum payment due on their credit cards had significantly lower delinquency rates on not only their credit cards, but also their auto loans and mortgages.
While TransUnion indicated consumers who made the minimum payment, or close to it, generally had higher delinquency rates, one of the study authors spotted a unique situation when it came to individuals who had a vehicle contract in the subprime financing space.
“When we looked at auto portfolios and looked specifically at subprime, we tend to see a reversal of that trend,” Antoni Guitart, director of research and consulting at TransUnion, told SubPrime Auto Finance News this morning after the credit agency released study results.
Read more here