Loan amounts and payments hit all time high!

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We all know prices of new cars are not going down so obviously loan amounts are going up, but the thing that hurts is how much. Most of us need a car to get back and forth to work. I’m not saying that we need a new car but sometimes there is no other option and some deals are to hard to pass up.

The average amount financed for a new vehicle is $28,381 and that was a record setter for the fourth quarter of 2014. This was an increase of $950 from the year earlier quarter and a rise of $582. The rise in transaction prices parallels that in amount financed. In December light vehicle transaction prices rose nearly 3 percent year-over-year to $34,367, making December the highest month on record for average transaction prices.

Experian’s data showed that the average new vehicle payment also hit a record in the fourth quarter, reaching $482, up from $471 in the year-earlier period. The average used-vehicle loan rose to $18,411 in the fourth quarter but this was not a record setter.

With these loans and payments hitting all time highs I have to wonder how most average people can afford a new car. Most baseline smaller cars are in the $20,000 range but once you start getting to your four wheel drive crossover/SUV territory prices start to sky rocket. Up here in New England it is almost needed to have an all wheel or 4 wheel drive car, especially this winter.