- A growing percentage of Americans with auto loans are struggling to make their monthly payments.
- Subprime borrowers in particular are feeling the impact of higher prices for both new and used vehicles.
- The rise in delinquencies also follows the end of loan-accommodation programs set up during the pandemic.
Despite the rise in delinquencies, Merchant believes the auto loan market remains healthy. The average interest rate for a new-vehicle loan climbed to 5.2% in the third quarter, while the average rate for a used vehicle loan hit 9.7%, according to TransUnion. Both are up more than one percentage point compared with the year-earlier period.
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