6 million Americans have stopped paying their car loans, and it's becoming a 'significant concern'

[FarCenter]

To be clear, the overall delinquency rate for auto loans is pretty stable, and the majority are performing well.

There are, however, signs of stress in the subprime market segment, which has seen rapid growth. Here are the key numbers from the report:

- The subprime delinquency rate for the trailing four quarter period moved to 2% in the third quarter. The only other time it was 2% or more was in the aftermath of the financial crisis.

- Subprime auto loan originations hit $31.3 billion in the third quarter, down from $33.6 billion in the second quarter. Bank and credit unions originated $9.5 billion in subprime auto loans in the period, a record high.

- Outstanding subprime auto loan balances now stand at $280.2 billion, a record high. For perspective, the pre-crisis high was $249.5 billion, in the fourth quarter of 2007.

In other words, the subprime delinquency rate is creeping up, while the subprime market is ballooning in size.

http://www.businessinsider.com/auto-loan-delinquency-numbers-from-ny-fed-2016-11

[global1]

1. Thanks Obama - For Saving The Auto Industry....

(sarcasm)

[FarCenter]

4. The current 17 million annually sales are clearly the result of a credit bubble & won't be sustained

New car sales for November 2016: Winners and losers

Read more: http://autoweek.com/article/car-news/new-car-sales-november-winners-and-losers-0

[Sherman A1]

2. Interesting

Thanks for posting.

[FSogol]

3. Our next bubble! Just wait until Trumpy and company do away with regulations on lenders.

2017 will see an increase in auto sales especially luxury brands, oversized trucks, and monstrous SUVs.
2018 and 2019 will see.... (you know how the rest goes)

[John_Doe80004]

5. and the Republicans

will blame Obama and the Democrats, God forbid they own the results of something they did!!!

[FarCenter]

6. Interest rates are already going up, so higher monthly payments should blunt demand

And the auto companies don't have their own lending operations anymore, e.g. GMAC, so they can't play the accounting tricks to boost volume by hiding bad loans on the lender books.

[FSogol]

7. Enter the 84 month car loan! No money down!

[lonestarnot]

8. What is the interest rate on subprime auto loan in most places, 26% or is it more?

[FarCenter]

9. It averaged 10.59% in the second quarter -- probably a point or two higher by now.

http://www.interest.com/car-loans/news/car-loans/

[lonestarnot]

10. Usury rate never-the-less. How can poor people afford that rate? So is 27 center heavily invested

in hedging against USA auto market now?