States with the highest auto loan balances

Average auto loan delinquency rates, interest rates and payouts aren’t really influenced by geographic location. Rather, they are determined by the driver’s credit rating and history, income, debts, and loan amount and term. But statistics broken down by location reveal the typical habits of drivers in each state.

During the past year, car crime rate have increased — meaning they are back to normal pre-pandemic levels, according to TransUnion. This increase is mainly due to the upsurge in unpaid bills following the end of pandemic-related relief.

In addition to that, vehicle shortage caused more demand coupled with less supply – meaning high purchase and financing costs. Overall loan balances increased 8% in 2022 from an already high $1.35 trillion in 2021, Experian found. So, as interest rates rise and delinquencies return to more normal levels, consider where your home state is in the reshuffle.

Car Payment Statistics

  • The average monthly payment for new cars is $667, according to Experian.
  • The average monthly payment for used cars is $515, according to Experian.
  • New cars cost an average of $48,301, according to Kelley Blue Book.
  • The average loan term for new cars is 69.46, according to Experian.
  • The average loan rate for new cars is 4.33%, according to Experian.
  • The average loan term for used cars is 68.01 months, according to Experian.
  • The average loan rate for used cars is 8.62%, according to Experian.
  • Drivers pay an average deposit of $6,026, according to Edmunds.

States with the highest car loan balance

An auto loan balance is the remaining amount a driver owes on their loan. The average car loan balance across the country is $5,210. Average state balances range from around $3,000 to over $6,000.

This data, collected from the New York Fed Consumer Credit Panel and Equifax, will be used to explore the top ten states — with two additional states due to a tie — with the highest auto loan balances.

  1. Texas: balance of $7,270
  2. Louisiana: balance of $6,510
  3. Georgia: balance of USD 6,080
  4. Arkansas: balance of $5,990
  5. Florida: balance of $5,980
  6. Oklahoma: balance of $5,900
  7. New Hampshire: balance of $5,860
  8. North Dakota: balance of $5,800
  9. Mississippi and Arizona: balances of $5,780
  10. Utah and Nevada: balances of $5,710

These higher balances are partly due to a few macro-environmental issues across the country, and are not just state-specific. A major factor is the question of supply versus demand. Vehicle inventory shrank last year due to supply chain issues and the cost of available cars rose, forcing drivers to finance more.

At the same time, drivers chose longer loan terms to reduce the monthly cost of their car payments. The average life of used vehicles in the second quarter reached a record high of 68.01 months. New vehicle terms told a similar story with driver funding for an average of 69.46 months.

Average car payment by state

Texas 680 $494.66
Louisiana 677 $487.62
Georgia 682 $505.07
Arkansas 683 $514.90
Florida 694 $470.24
Oklahoma 682 $463.78
New Hampshire 724 $471.61
North Dakota 727 $546.00
Mississippi 667 $489.55
Arizona 696 $491.75
Utah 716 $477.25
Nevada 686 $468.50

The average monthly payment figures for each state were calculated using a combination of the average car price for the state, the average loan term, and the interest rate.

Drivers can take between 24 and 60 months to pay off their vehicle, with some even taking up to eight years, which can be a risk. A longer duration reduces the monthly cost, but results in a higher overall cost.

The interest rate you pay for your vehicle is based on a variety of factors such as your credit, the type of vehicle and the terms you choose. On average, drivers can expect to pay around 4.33% for new cars and 8.62% for used cars, according to second-quarter data from Experian. Below are the average APRs as of October 26, 2022, based on a Discount rate study.

New car 5.58% 5.61% 5.63%
Used car 5.88% 6.22% 7.31%

Average Used Car Price by State

Texas $34,340
Louisiana $33,937
Georgia $34,936
Arkansas $35,499
Florida $33,229
Oklahoma $33,145
New Hampshire $33,021
North Dakota $37,279
Mississippi $34,048
Arizona $34,174
Utah $33,344
Nevada $32,843

Vehicle prices have reached record highs in 2022. New vehicles cost more than $48,000 in the summer of 2022, up 11.9% from the same time last year, according to Kelley Blue Book.

Fortunately, Used Vehicle prices are again at stable prices, with the average price of a used car selling for $28,237 in September, according to Kelley’s Blue Book. In terms of vehicle types, SUVs remain the most popular, exceeding 60% of vehicles financed in the second quarter of 2022, according to Experian.

In North Dakota, which has the highest average used car price, the top-selling vehicles are SUVs. While in Nevada, at the other price end, the most popular vehicle types are passenger cars, according to iSeeCars.

Auto Loan Default by State

Texas 5.00%
Louisiana 5.64%
Georgia 5.15%
Arkansas 2.53%
Florida 4.66%
Oklahoma 4.86%
New Hampshire 2.14%
North Dakota 2.27%
Mississippi 6.14%
Arizona 4.00%
Utah 1.92%
Nevada 2.12%

Texas, which has the highest average car payment, has a high average delinquency rate, but not the highest among the top states. Mississippi leads with 6.14, well above the national averages displayed below.

Interestingly, however, TransUnion found that consumers continue to assess their auto loans in line with other financial commitments. Second only to mortgages, and far more than credit cards, drivers prioritize vehicle payments.

When it comes to prioritizing your payment, the key is preparation. To do this, you should only finance what you can afford. The best way to do this is to calculate your expected monthly payment and what accrued interest will look like over the term of the loan.

States with the lowest car loan balance

Hawaii $3,970
massassuchutes $4,020
Connecticut $4,050
New York $4,080
Oregon $4,300

Hawaii wins the gold medal for the lowest average car loan balance, followed closely by the home of the Mayflower, Massachusetts. These states have averages significantly lower than the national median of $5,210. But as explained, the auto loan balance is independent of the ZIP code and instead relates to the typical context of each state.

Financial literacy, income and cost of living all play an important role. When looking at the states with the lowest balances, for example, three of the five have one of the highest median household incomes in the country, according to the Census Bureau. When you dive deeper, average credit scores also tend to be higher.

Hawaii’s average FICO score is 723, falling into the very good category according to Equifax. The other states with equally competitive averages.

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