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NEWS: Auto loan delinquencies keep climbing
Subprime delinquencies (FICO: 580–669) jumped 26 basis points to 5.17% in Aug.
Even prime loans (660–719) saw a slight uptick to 0.50% overdue.
The reason?
Consumers with auto loans originated in the past two years are falling further behind as elevated interest rates and vehicle prices squeeze household finances.
Of subprime auto loans originated in 2023, 13.4% are 30+ days to 90+ days overdue.
And there’s another red flag—
Loss severities (the portion of value investors lose when borrowers default) on 2023 subprime loans are the highest on record.
Bottom line: Consumer resilience has kept a recession at bay but it could be reaching its limits.
NEWS: Auto loan delinquencies keep climbing
Subprime delinquencies (FICO: 580–669) jumped 26 basis points to 5.17% in Aug.
Even prime loans (660–719) saw a slight uptick to 0.50% overdue.
The reason?
Consumers with auto loans originated in the past two years are falling… pic.twitter.com/lSLXAsf4K4
— Car Dealership Guy (@GuyDealership) September 10, 2024