The percentage of subprime and deep subprime auto loans fell to its lowest levels since 2012 during the first quarter this year, according to a recent report from Experian Automotive.

According to Experian’s State of the Automotive Finance Market, subprime loans made up 16.2 percent of the market, while deep subprime loans accounted for 3.5 percent.

“Over the last year, there has been a tremendous amount of conversation around the growth in subprime loans, and the concern over the automotive finance industry approaching a potential ‘bubble,’” Melinda Zabritski, Experian’s senior director of automotive finance, said in a statement. “While it’s true that the volume of subprime loans is up, the same can be said for the rest of the risk categories. It’s important to keep in mind that, while we should continue to watch them, the percentage of subprime loans make up a small portion of the market.”

Furthermore, auto lenders also continued to grow their overall portfolios, with total outstanding balances for automotive loans reaching a record-high $905 billion in the first quarter, representing a year-over-year increase of 11.3 percent, the Experian report said.

According to Experian, both 30- and 60-day delinquencies also showed year-over-year decreases, with 30-day delinquencies falling 4.1 percent and 60-day delinquencies falling 3.2 percent over the prior year.

According to the report, the highest delinquency rates were found primarily in the South, while the states with the lowest delinquency rates were concentrated in the Midwest and Northwest.

Experian: Subprime Auto Loans, Delinquencies Fell In Q1

by Banker & Tradesman time to read: 1 min