More and more consumers are opting for car finance through loans. In the first half of 2016 was a rise in car loans recorded, as the Banking Association announced.
The fact that buying a car is currently financed by a loan is also due to the particularly low interest rates.
Number of car financing increased
In the first half of 2016, the commercial banks granted vehicle financing for 894,000 vehicles. This represents an increase of 4.6 percent compared to the first half of 2015. The increased interest in loans for car purchases is also contributing to an increase in new lending business in general: the total volume of new lending to businesses and consumers in the first half of 2016 was one Value of 73.9 billion euros, 12.6 percent higher than in the same period last year.
Even used cars are financed through loans
It is noticeable that many used vehicle purchases are also financed by credit: The vehicle financing of new cars rose by 4.1 percent in the first half of 2016, and of used cars by as much as 5 percent. Nationwide, the registered ownership of used cars in the first six months of the year with 3.7 million more than twice as high as the registrations of new cars: Here, the number in the first half of the year to 1.7 million.
Low interest rates create good conditions for buying a car
Currently, consumers can look forward to the low interest rates on favorable lending rates. Steven J. Barnes, Managing Director of the Banking Federation, also said: “Consumers’ employment prospects continue to be good and payment practices remain high.” According to the association, around 98 percent of all consumer credit is properly repaid. The Consumer Credit Index, which the Duresearch Institute (DI) calculates twice a year, suggests that the use of personal loans – such as vehicle finance – will remain at a high level in the coming twelve months.