Which would you pay first, the car loan or the mortgage?

I just read an interesting article about changing priorities in this country. This is from Realtor.org.

Americans are prioritizing their debt payments by opting to pay their car loans before mortgages and credit cards, according to an analysis by credit reporting bureau TransUnion.

TransUnion analyzed the payment patterns of 4 million consumers who had at least one car loan, bank card, and mortgage payment.

"With unemployment remaining high and real estate values remaining stagnant or further depreciating, consumers continued to pay their credit cards ahead of their mortgages,” says Ezra Becker, vice president of research and consulting in TransUnion’s financial services unit. “However, the importance of their auto loans appears to have trumped even the value they place on their credit cards."

TransUnion found in its analysis:

• Nearly 40 percent who were delinquent on their mortgage were still current on their auto loans and credit cards.


• 17.3 percent who were delinquent on their credit cards were still current on their auto loans and mortgages.


• 9.5 percent who were behind on their auto loan were still current on their credit card and mortgage payments.

Becker speculates that car loans have become more important to Americans because often Americans need a car to get to work or to look for employment, and “the fact that an auto loan is not a revolving loan — the impact of repossession is greater than the loss of a credit card.” Becker also says that the drop in home values may also be shifting Americans’ payment preferences in putting their car loans first.