Lending Curve
The recent Federal Reserve Beige Book offered an interesting perspective for the auto lending market. Uncertainty around trade policy was pervasive across all 12 districts, with the majority showing flat to down growth. Non-auto consumer spending was lower overall – but most districts saw moderate to robust sales of vehicles.
Point Predictive released its 2025 Auto Lending Fraud Report, revealing some startling data. In 2024, lenders’ estimated fraud loss exposure reached approximately $9.2 billion – an increase of 16.5% year over year. First-party fraud accounted for 69% of all auto lending risk. While these numbers are alarming, the good news is that your best defense is your employees. Your job is to ensure they are up to date on their training.
Consumer confidence took a hit in February. According to The Conference Board, the non-partisan nonprofit which administers the monthly Consumer Confidence Survey, consumer confidence registered the largest monthly decline since August 2021. Reflecting the third consecutive month-on-month decline, consumer views of current labor market conditions weakened, consumers are pessimistic about future business conditions, and less optimistic about future income. Pessimism about future employment prospects worsened and reached a ten-month high. The University of Michigan monthly Consumer Sentiment Index reflected that consumers expect prices for goods will continue to rise and inflation will continue to hamper big-ticket purchases.
