Bidenomics: Americans Falling Behind on Auto Payments at Record Rate, Mass Repossessions Looming

A new snapshot of the struggles of American consumers to keep up with their bills comes from data showing a rise in vehicle owners having trouble making their payments on time.

The rate of subprime interest rate borrowers who are behind 60 days or more on their payments hit 6.11 percent in September, according to Bloomberg.

That’s 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.

“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,” Margaret Rowe, senior director at Fitch, said.

Borrowers are considered subprime if they have mediocre credit scores and might be a risk to pay on time.

For buyers with good credit ratings, interest on a car loan averages at about 5.07 percent for a new car and 7.09 percent for a used one, according to Bankrate. The worst ratings pay averages of about 14.18 percent for new vehicles and 21.38 percent for used ones. Subprime borrowers are in between those extremes.

If consumers get too far behind, they lose their vehicle.

Cox Automotive estimates that 1.5 million vehicles will be repossessed this year, according to Insider