Car loan trouble ahead

Moody's Investors Service has warned that delinquencies and defaults among Australian motor vehicle loans are set to increase in 2016.

The numbers of car loan borrowers who are now behind by 30 days or more has increased to 1.33 per cent, up from 1.20 per cent at 30 September 2015 and 1.07 per cent at 31 December 2014.

Moody’s said more car loans were likely fall behind as below-trend GDP growth in Australia and uncertain labour market conditions, particularly in the cooling economies of the mining states hit borrowers.

Source: Banking Day