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Home https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ Business https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ More Americans are lagging behind their car loans than ever before

More Americans are lagging behind their car loans than ever before



More than 7 million car loans have expired for at least 90 days in the fourth quarter, according to data released this week by the Federal Reserve in New York.

This is 1.3 million more overdue loans than the previous peak that followed the Great Recession in 2011. The unemployment rate in 2011 is more than twice the current level.

The growing problem of people lagging behind in car loans contradicts the picture of a strong American economy. This is particularly worrying because the rate of overdue car loans is lower than for other types of loans such as credit cards and student loans.

"The significant and growing number of troubled borrowers suggests that not all Americans have benefited from the strengths of the labor market and require constant monitoring and analysis of this sector," the Federal Reserve report said. , 5% of all car loans are overdue today, which is lower than the end of the recession when the rate rose to 5.3% at the end of 201
0

But it is rising again. in all except for two quarters of early 2015

The reason that there are just more loans than any other time, according to the Fed.

In the fourth quarter of the US market there were about 89 million loans, and in 2018 Jeeps took over all the data- src-mini = "// cdn.cnn.com/cnnnext/dam/assets/181212164211-volvo-xc40-small-169.jpg" data-src-xsmall = "// cdn.cnn.com/cnnnext/dam/ assets / 181212164211-volvo-xc40-medium-plus-169.jpg "data-src-small =" http://cdn.cnn.com/cnnnext/dam/assets/181212164211-volvo-xc40-large-169.jpg "data-src-medium =" // cdn.cnn.com/cnnnext/dam/assets/181212164211-volvo-xc40-exlarge-169.jpg "data-src-large =" // cdn.cnn.com/cnnnext /img/assets/181212164211-volvo-xc40-super-169.jpg "data-src-full16x9 =" // cdn.cnn.com/cnnnext/dam/assets/181212164211-volvo-xc40-full-169.jpg " data-src- mini1x1 = "// cdn.cnn.com/cnnnext/dam/assets/181212164211-volvo-xc40-small-11.jpg" data-request-load = "not-loaded" data-eq-pts = xsmall: 221, small: 308, medium: 461, large: 781 "src =" data: image / gif; base64, R0lGODlhEAAJAJEAAAAAAP /////// wAAACH5BAEAAAIALAAAAAAQAAkAAAIKlI + py + 0Po5yUFQA7 "/>

Creditors often offer funds to people with low credit scores, which contributes to the increase in the number of car loans. More than 20% of the car loan balance belongs to those borrowers who are much more likely to fail in car lending.

The average purchase price of a new car last year was $ 36,440, according to Kellie Blue's book. That's over $ 7,400 a decade ago. The rate of rise in prices outpaced overall inflation over the last decade.

Automobile companies sell more jeeps, which are more expensive than sedans. And the new safety features, such as automatic braking and traffic warnings in adjacent bands, have increased the price.

The greater availability of car loans and the longer average duration of these loans has forced some Americans to buy more expensive cars.


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