subprime borrowers

Growing attention is being paid to trouble in the US auto loan market, with warnings that subprime auto loan notes are deteriorating fast and could signal broader economic stress. Commentators argue that rising missed payments and defaults among borrowers point to pressure on household finances, and some frame the situation as a warning sign for the wider American economy.

A growing number of American car owners owe more on their vehicles than the cars are worth, a sign of stress in the subprime auto loan market. Some borrowers are responding by keeping their cars longer, while others are rolling negative equity into new loans, deepening their debt. Commenters point to the practice as a warning about loose lending standards in the US car market.