Equifax snapshot gives glimpse of current subprime volume
Equifax recently offered a week-long snapshot of auto financing originated during the middle of September, revealing the amount of subprime financing providers are booking.
According to Equifax estimates during the week of Sept. 13, the industry generated 14,100 retail installment contracts and leases, totaling $401.8 million.
Of that amount, analysts determined 1,400 contracts and leases were originated with to consumers with a VantageScore 3.0 credit score below 620, what Equifax generally considers to be subprime accounts. Equifax said those subprime accounts represented a corresponding total balance of $41.5 million.
Equifax also discovered the subprime volume was slightly lower when using the FICO Auto 8 credit score as the guide.
Analysts said 1,200 contracts and leases were originated during that week in September with consumers with a FICO Auto 8 credit score below 620; again, generally seen as subprime. Those deals had a corresponding total balance of $36.5 million.
Equifax also determined the average origination balance for all auto financing generated during that week in September came in at $28,408. The average for a subprime account was a little higher, sitting at $29,924.
When looking specifically at leases during that particular timeframe, Equifax indicated the average origination balance was $15,028. For a lease with a subprime consumer, the average lease amount was $15,974, according to analysts.
All told, Equifax estimated that leasing accounted for 38.3% of all auto accounts and 20.3% of all auto balances during its September reporting period.