Bidenomics: U.S. Car Owners Falling Behind on Auto Payments at Highest Rate On Record – Mass Repossessions Loom

by J Pelkey
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New data reveals the challenges American consumers face in keeping up with their financial obligations, particularly concerning their auto payments.

In September, the rate of subprime interest rate borrowers falling 60 days or more behind on their payments reached 6.11 percent, as reported by Bloomberg. This marks the highest share who can’t make ends meet since 1994, and up from the 5.93 percent rate at the start of this year.

Margaret Rowe, Senior Director at Fitch, noted, “The subprime borrower is getting squeezed. They can often be a first line of where we start to see the negative effects of macroeconomic headwinds.”

As interest rates rise, making new loans more costly, a significant number of car owners find themselves grappling with the affordability of their payments. This underscores a notable sense of financial strain during a period when the economy is sending mixed signals, particularly regarding the state of consumer spending.

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According to a CNN report, the trajectory suggests that the issue is going to get worse. The report highlighted that Moody’s current projection indicates that the rate of delinquent vehicle loans is expected to reach 10 percent by 2024.

CNN also pointed out that consumer delinquencies extend beyond car loans.

In the second quarter, the rate of new credit card delinquencies rose to 7.2 percent, marking an increase from the previous quarter’s 6.5 percent.

Bloomberg also reported that during the same period, credit card debt surpassed the $1 trillion mark.

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