Americans Are Overdue With Their Car Payments At Highest Rate In Nearly 30 Years (2024)

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Americans Are Overdue With Their Car Payments At Highest Rate In Nearly 30 Years (2024)

FAQs

Americans Are Overdue With Their Car Payments At Highest Rate In Nearly 30 Years? ›

Higher car prices and rising interest rates are hindering car owners' ability to afford their vehicle payments, as 6.1% of subprime auto borrowers are at least 60 days past due on their loans, the highest percentage in data dating back to 1994, according to Bloomberg, which cited Fitch Ratings.

What percentage of people are late on car payments? ›

4.2% of outstanding auto debt was at least 90 days late in the fourth quarter of 2023, according to the New York Fed, up 11.8% from the fourth quarter of 2022. Meanwhile, the percentage of auto loans that fell to 30 days due was 7.7% in the fourth quarter this year, up 15.8% from 6.6% in the fourth quarter last year.

How many Americans are behind on their car payments? ›

In September, the percentage of auto borrowers who were at least 60 days late on their bills rose to 6.11%, according to a Fitch Ratings report obtained by FOX Business.

Are people defaulting on their car payments? ›

More Americans are defaulting on their car loans due to larger loan amounts, high interest rates, increased living costs and more.

Do Americans fall behind on car payments at higher rate than in 2009? ›

Auto loan delinquency in the first quarter of 2023 exceeded the high watermark set in 2009 and 2010, with more than 1.69 percent of loans 60 days past due.

Are people falling behind on car payments? ›

Yet even though people are working, many are falling behind on their car payments. Younger borrowers and lower-income workers face more difficulties making car payments, indicating increased financial stress, according to the Federal Reserve Bank of New York.

How many years are most car payments? ›

Auto loans are available in 12-month increments, ranging from 24 to 96 months. The most common terms are 60 and 72 months, but 84-month terms are becoming more common. There is no perfect term, and it is instead specific to your budget and needs.

How many Americans have $1000 car payments? ›

Nearly 15% of drivers who financed a new vehicle toward the end of 2022 are shelling out more than $1,000 a month, the highest percentage ever recorded, according to automotive research company Edmunds.

Are Americans struggling to make car payments? ›

Americans are having a harder time getting approved for auto loans, as banks worry over the risk of defaults at a time when high interest rates and elevated car prices are squeezing budgets. With borrowers struggling to make their monthly car payments, banks are responding by tightening credit standards.

What is the average car payment in America? ›

The average monthly car payment for new cars is $726. The average monthly car payment for used cars is $533. 39.20 percent of vehicles financed in the third quarter of 2023 were new vehicles. 60.80 percent of vehicles financed in the third quarter of 2023 were used vehicles.

Why is making car payments a poor decision? ›

Financing a vehicle purchase through an auto loan is a routine practice for many consumers in the United States. However, the structure of these loans and the way new cars rapidly depreciate in value means this decision often ends up costing significantly more than the vehicle is worth over the life of the loan.

What happens when you are behind on car payments? ›

If you get behind on your car payments or don't have auto insurance, the loan company can take your car. This is called vehicle repossession. If your car is repossessed, you must act quickly to get it back.

Is a 1k car payment too much? ›

For large luxury models, $1,000-plus payments are the norm. Even a handful of buyers with subcompact cars have four-figure payments, likely due to having shorter loan terms, poor credit, and still owing money on previous car loans, according to Edmunds analysts.

What percent of Americans are behind on car payments? ›

The latest data from Fitch Ratings shows that 6.1% of subprime borrowers were at least 60 days past due on their car payments -- the highest percentage since 1994. Two factors are causing an increase in late car payments: the rapid rise of car prices over the past few years and high interest rates.

How long does the average American keep their car? ›

The average time that Americans have owned a car the longest is about 8 years. Americans are keeping their cars for longer periods of time, with the average age of vehicles at 12.5 years. Our study found that on average, people have their longest-owned cars for about 8 years.

What is the average American car payment in 2024? ›

Car payment statistics 2024
  • For new cars, the average monthly payment is $716, and for used cars, it's $526.
  • By the end of last year, 39.5 percent of new cars and 60.5 percent of used cars were funded.

How many people miss car payments? ›

In mid-2021, the Lab said, 1.5% of auto loans in California were more than 30 days overdue. By December 2022, the latest data available, that rate was up to 2.7%.

What percentage of car loans are delinquent? ›

US Auto Loans Delinquent by 90 or More Days is at 4.41%, compared to 4.17% last quarter and 3.89% last year. This is higher than the long term average of 3.49%.

How bad is it to be late on a car payment? ›

Keep in mind that if your auto loan payments are late, it could negatively impact your credit reports and scores. Missed payments or defaulting on your auto loan could also result in your car being repossessed. Your lender should be able work with you if you're having issues or if there are errors on your account.

How many people make late payments? ›

Delinquency rates have been steadily rising since the end of 2021: About 3.2% of all debt was past due to some degree in the first quarter, according to the bank, compared with 3.1% at the end of 2023.

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