"Car loans have gone from the safest consumer credit products to among the riskiest over the last 15 years as delinquencies rose more than 50%, driven by soaring car prices and rising interest rates, a new study shows. Consumers across all income categories are struggling to make monthly car payments, according to VantageScore, a credit-scoring company. Auto loans were once a safe haven, with drivers prioritizing payments on their transportation above other debts."
"The study found that 1.6% of total auto loans were 60 days or more past due as of July 2025, while credit card and first mortgage loan delinquencies are less than 1%. US consumers purchased about 16 million new cars last year and the majority were financed. There are close to 300 million cars on the road in America. VantageScore found that, in relative terms, monthly car payments are increasing faster than mortgage payments."
Auto loan delinquencies, defined as 60 or more days past due, rose 51.5% from Q1 2010 through Q1 2025. As of July 2025, 1.6% of auto loans were 60+ days past due, while credit card and first mortgage delinquencies remained below 1%. New car prices have climbed more than 25% since 2019 and now average over $50,000, with average monthly payments at $767 and one in five borrowers paying over $1,000. Interest rates on new car loans exceed 9%, worsening affordability. About 16 million new cars were purchased last year, most financed, and nearly 300 million cars are on the road. No income group is immune.
Read at Fortune
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