Summary
The article describes the current state of auto loans in the United States. More people are struggling with auto loan payments, with a record number of car repossessions and high rejection rates for new loan applications. This trend is happening during President Trump's administration, affecting the economy and showing financial stress among households.
Key Facts
- Car repossessions in the U.S. reached 1.73 million last year, the highest since 2009.
- The New York Fed's survey shows the rejection rate for credit applications is at a record high of 24.8%.
- Subprime borrowers, who often have lower credit scores, are facing a delinquency rate of 6.65% on car loans, the highest ever recorded by Fitch's data.
- The government's recent shutdown and debates about food assistance have affected economic stability.
- A 25% tariff on imported cars was introduced by President Trump to encourage buying U.S.-made vehicles.
- Prime credit borrowers (those with higher credit scores) have a low delinquency rate of 0.37%, showing stability for those with better credit.
- Discussions around potential interest rate caps on loans could affect credit availability for riskier borrowers.
