Auto Loan Delinquency and Default Rate Trends
Research compiled by Veritas Financial Services | Last updated: July 2026
Auto loan serious delinquency, defined as balances 90 or more days past due, reached 5.6% as of the first quarter of 2026, according to the New York Federal Reserve’s Household Debt and Credit Report. That reading surpasses the financial crisis recovery peak of 5.3% set in the fourth quarter of 2010, marking a new high for the series. What makes the current reading unusual is the backdrop. When delinquency last approached these levels in 2010, unemployment sat above 9%. Today it is closer to 4.3%, which means the stress is building in a labor market that, by historical standards, still looks healthy.
The rate has now climbed for eleven consecutive quarters from a post-pandemic trough of 3.9% in the second quarter of 2022, rising from 5.2% in the fourth quarter of 2025 to 5.6% in the first quarter of 2026. That steady rise is the throughline of this report. Delinquency is a lagging indicator: the accounts falling behind today reflect underwriting, pricing, and affordability decisions made 6 to 24 months earlier. Reading the trend, then, is less about the current month and more about the vintages already on lender books. This report compiles delinquency, default, and repossession data published between 2024 and 2026, drawn from federal regulatory sources, credit bureaus, ratings agencies, and industry research. All figures are U.S.-based unless otherwise noted.
How Loan Delinquency and Default Are Measured
Delinquency describes a borrower who has missed one or more payments. Default is a further stage: a loan is generally treated as being in default once it reaches 90 or more days past due, the point at which recovery becomes unlikely without intervention. The distinction matters because the odds of an account curing fall sharply once it crosses the 90-day line, while the likelihood of repossession and eventual charge-off rises. Loans that reach that stage rarely self-correct.
One definitional wrinkle deserves a flag before any of the figures below are read. “Serious delinquency” does not mean the same thing across every source. The New York Federal Reserve uses a 90+ day threshold for auto loans, while ratings agencies such as Fitch commonly report auto performance at 60+ days past due. Any cross-source comparison has to hold the threshold constant; otherwise, consistent data will appear to contradict itself.
Auto Loan Delinquency Lifecycle Stages
| Stage | Days Past Due | Typical Label | Cure Likelihood | Lifecycle Significance |
|---|---|---|---|---|
| Early | 30+ DPD | Early delinquency | Moderate to high | Most accounts still cure; monitored as a flow signal |
| Moderate | 60+ DPD | Serious (Fitch/agency basis) | Declining | Common ratings-agency reporting threshold for auto ABS |
| Serious | 90+ DPD | Serious (NY Fed basis) / default proxy | Low | Rarely self-corrects; repossession and charge-off risk rises |
| Terminal | 120+ DPD | Charge-off / repossession | Very low | Account moves to recovery; vehicle assigned for repossession |
Sources: Table11
Auto Loan Delinquency Rate Trends, 2019 to 2026
The serious delinquency rate did not spike; it drifted upward with remarkable consistency. From the 3.9% trough in mid-2022, the rate hovered in the low-4% range through most of 2024, moved above 4.8% by late 2024, and crossed 5% in late 2025. Each step was small, but the direction never reversed. For a large lender holding hundreds of thousands of accounts, a move from roughly 4% to over 5% can mean thousands of additional problem loans entering late-stage collections.
Serious Auto Loan Delinquency Rate (90+ DPD), Household Basis
| Period | 90+ DPD Rate | Change vs. Prior Year | Market Context |
|---|---|---|---|
| Q2 2022 | 3.9% | Trough | Stimulus and forbearance suppressed delinquency |
| 2024 (avg) | Low-4% range | Rising | Rate begins sustained multi-quarter climb |
| Late 2024 | 4.8%+ | Rising | Payment burdens and vehicle prices elevated |
| Q4 2025 | 5.2% | Up ~1.3 pts from 2022 trough | Highest since Q4 2010 at the time |
| Q1 2026 | 5.6% | Up ~12% year over year | New series high; surpasses Q4 2010 peak of 5.3% |
Sources: Table 22
The record has now been broken. The prior all-time high of 5.3% was set in the fourth quarter of 2010, during the financial crisis recovery, and had stood for more than fifteen years. The first-quarter 2026 reading of 5.6% clears it by 0.3 percentage points. The comparison is starker than the rate alone suggests. Total auto loan balances stand at roughly $1.69 trillion today, more than double the roughly $800 billion outstanding in 2010. Hence, the absolute number of seriously delinquent accounts is materially higher now than during the crisis, even setting the rate aside.
Early-Stage vs. Serious-Stage Flow Rates
A second set of figures complicates the simple upward story. Lender-portfolio flow rates, which measure the pace at which accounts enter delinquency rather than the standing stock of delinquent balances, softened in early 2026. These are a different metric from the household stock rate above and should not be plotted on the same line. Still, they suggest that the inflow of newly troubled loans is not accelerating, even as the accumulated stock remains elevated. New York Fed researchers have pointed to the flow rate as the better read on the current state of the market, and by that measure the pace of deterioration slowed in the first quarter of 2026.
| Metric | Q1 2025 | Q1 2026 | Direction |
|---|---|---|---|
| 30+ DPD early flow rate | 7.99% | 7.72% | Easing |
| 90+ DPD serious flow rate | ~3.0% | 2.97% | Roughly flat |
| New auto originations (quarter) | N/A | $182 billion | Lending continues |
| Total auto loan balances | N/A | $1.69 trillion | Grew ~$18 billion |
Sources: Table 33
Divergence by Credit Tier
The national average conceals more than it reveals. Risk in the current cycle is highly concentrated rather than broadly distributed, and the gap between the strongest and weakest borrowers has widened to an extreme. Prime and subprime portfolios are now telling almost opposite stories, and averaging them together produces a number that describes neither.
60+ Day Auto Loan Delinquency Rate by Credit Tier (2025 to early 2026)
| Credit Tier | 60+ DPD Rate | Year-over-Year | Trend |
|---|---|---|---|
| Prime | 0.37%-0.63% | Essentially unchanged | Stable; strong borrower fundamentals |
| Near-prime | Elevated, rising | Climbing | Losses rising |
| Subprime | 6.43%-6.9% (peak) | Record high | Highest in 30+ years of tracking |
Sources: Table 44
One nuance runs against the tidy prime-versus-subprime framing. VantageScore analysis found that tightened lending criteria reduced delinquencies among subprime borrowers, but that losses in the near-prime and prime tiers climbed rapidly enough to more than offset those reductions. In other words, the stress is not staying neatly contained in the lowest tier.
The Student-Loan Reporting Distortion
Part of the subprime picture is a measurement artifact rather than a behavioral one. When federal student-loan forbearance ended and delinquency reporting resumed in late 2024, roughly two million auto-loan borrowers had a student-loan delinquency added to their credit file in the first quarter of 2025. One in five of those consumers saw their score fall by 100 points or more effectively overnight. Many were pushed into the subprime tier despite remaining current on their car payments.
Factors Reshaping the Subprime Auto Loan Pool
| Factor | Effect on Credit Scores | Effect on Actual Auto Payment Behavior |
|---|---|---|
| Forbearance ends (Oct 2024) | Student-loan delinquencies re-reported to bureaus | None directly; auto payments often still current |
| Score migration (Q1 2025) | ~2 million borrowers gain a student-loan delinquency flag | Mix shift into subprime, not a rise in missed car payments |
| Score drops | 1 in 5 affected borrowers fall 100+ points | Payment hierarchy holds; cars are paid first |
| Payment hierarchy | Reported subprime rate distorted downward as pool grows | Consumers ~4x more likely to miss student loans than auto |
Sources: Table 55
From Default to Repossession
Rising serious delinquency eventually converts into recoveries, and the repossession data confirms the pipeline is full. After collapsing to historic lows from 2020 to 2022, when stimulus and forbearance kept borrowers afloat, repossession activity normalized through 2023 and 2024 and then accelerated. The figures here carry an important caveat: sources measure different things, and the range is wide.
U.S. Auto Repossession Volume by Year
| Year | Repossessions | Change | Historical Comparison |
|---|---|---|---|
| 2022 | ~1.2 million | Recovering from lows | Below pre-pandemic norms |
| 2023 | ~1.5 million | +29% vs. 2022 | Approaching 2019 levels |
| 2024 | ~1.73 million | +43% vs. 2022 | Highest since 2009 |
| 2025 | ~1.8 million | Rising | Upper projections not seen since Great Recession |
Sources: Table 66
Cost Drivers Behind the Trend
The delinquency climb is not mysterious. The cost of owning and financing a vehicle rose across nearly every line item, compressing household budgets and pushing marginal borrowers past the point where they could keep up with payments.
Cost-of-Ownership Pressures, 2020–2025
| Cost Factor (Average) | Earlier Value | 2025 Value | Change |
|---|---|---|---|
| New vehicle price | $48,000 (Q4 2024) | Over $50,000 (Q4 2025) | Rising |
| Monthly payment (new) | $700–$720 (2024) | $749 | +14% vs. 2021 |
| Monthly payment (used) | $494 (2021) | $523 | +6% vs. 2021 |
| Car insurance | Baseline | +19% year over year | Rising |
| Repair and maintenance | Baseline | +33% since 2020 | Rising |
Sources: Table77
2026 Outlook
The consensus among industry analysts points to a manageable but higher-risk environment in 2026. With serious delinquency now at a series high of 5.6%, the pressure is expected to persist rather than release quickly, though the pace of deterioration has shown early signs of slowing. Flow rates, the leading read on new stress entering the system, eased in the first quarter of 2026 even as the standing stock of delinquent balances set a record. The divergence by credit tier is expected to persist. Prime portfolios look relatively stable; subprime portfolios remain under pressure, with 30+ and 60+ day delinquencies likely to remain elevated.
Two structural signals suggest the pressure will not release quickly. First, nearly 29% of auto finance customers are now categorized as financially vulnerable, making affordability controls at origination more consequential than in years. Second, the lagging-indicator dynamic means the portfolios showing stress now reflect decisions already made; the vintages originated in 2024 and 2025 are underperforming 2019 benchmarks. The result is less of a crisis year than one in which execution quality in underwriting, servicing, and recovery separates the strong lenders from the exposed ones.
References
- Federal Reserve Bank of Philadelphia. (2026, April). Do recent auto loan delinquency rates overstate borrower distress? https://www.philadelphiafed.org/-/media/FRBP/Assets/Consumer-Finance/Reports/cfi-report-april-2026-do-recent-auto-loan-delinquency-rates-overstate-borrower-distress.pdf. General auto loan distress context. Accessed July 2026.
- Consumer Financial Protection Bureau. (2025, January). Repossession in auto finance. https://files.consumerfinance.gov/f/documents/cfpb_report-repossession-in-auto-finance_2025-01.pdf. General repossession regulatory context. Accessed July 2026.
1Table 1:
- DefiSolutions. (2026, February 20). Auto loan delinquency rates and trends. https://defisolutions.com/defi-insight/auto-loan-delinquency-rates-and-trends/
- Fitch Ratings. (2025). Auto ABS delinquency indices. https://www.fitchratings.com. Accessed July 2026.
- New York Federal Reserve. (2026). Household debt and credit report. https://www.newyorkfed.org/microeconomics/hhdc. Accessed July 2026.
- DefiSolutions. (2026, March 10). Auto loan default rates, repossession, and collections: Industry data and insights. https://defisolutions.com/defi-insight/auto-loan-default-rates/
2Table 2:
- New York Federal Reserve. (2026). Household debt and credit report. https://www.newyorkfed.org/microeconomics/hhdc. Accessed July 2026.
- New York Federal Reserve. (2026). Household debt and credit report. https://www.newyorkfed.org/microeconomics/hhdc. Accessed July 2026.
- DefiSolutions. (2026, February 20). Auto loan delinquency rates and trends. https://defisolutions.com/defi-insight/auto-loan-delinquency-rates-and-trends/
- DefiSolutions. (2026, February 20). Auto loan delinquency rates and trends. https://defisolutions.com/defi-insight/auto-loan-delinquency-rates-and-trends/
- AmericanDefault.org. (2026, May 6). Auto loan delinquency rate 2025–2026: 5.2%, approaching GFC-era peak. https://americandefault.org/statistics/auto-loan-delinquency/
- New York Federal Reserve. (2026, May 12). Household debt balances rise slightly as delinquency transition rates hold steady. https://www.newyorkfed.org/newsevents/news/research/2026/20260512. Accessed July 2026.
3Table 3:
- WardsAuto. (2026, May 14). Auto loan delinquency rates increased more slowly in Q1. https://www.wardsauto.com/news/auto-loan-delinquency-rates-increased-more-slowly-in-q1/820045/
- WardsAuto. (2026, May 14). Auto loan delinquency rates increased more slowly in Q1. https://www.wardsauto.com/news/auto-loan-delinquency-rates-increased-more-slowly-in-q1/820045/
- LendingTree. (2026, June 23). Average car payment and auto loan statistics: 2026. https://www.lendingtree.com/auto/debt-statistics/
- New York Federal Reserve. (2026). Household debt and credit report. https://www.newyorkfed.org/microeconomics/hhdc. Accessed July 2026.
4Table 4:
- NewsNation. (2025, November 12). Late car payments hit record among subprime borrowers. https://www.newsnationnow.com/business/your-money/late-car-payments-hit-record/
- VantageScore. (2025, November 19). VantageScore analysis reveals increase in auto loan delinquencies across all credit tiers. https://vantagescore.com/resources/knowledge-center/press-releases/vantagescore-analysis-reveals-increase-in-auto-loan-delinquencies-across-all-credit-tiers
- NewsNation. (2025, November 12). Late car payments hit record among subprime borrowers. https://www.newsnationnow.com/business/your-money/late-car-payments-hit-record/
5Table 5:
- Cox Automotive. (2026, February 19). End of student loan relief reshapes auto lending. https://www.coxautoinc.com/insights/end-of-student-loan-relief-reshapes-auto-lending/
- Cox Automotive. (2026, February 19). End of student loan relief reshapes auto lending. https://www.coxautoinc.com/insights/end-of-student-loan-relief-reshapes-auto-lending/
- Cox Automotive. (2026, February 19). End of student loan relief reshapes auto lending. https://www.coxautoinc.com/insights/end-of-student-loan-relief-reshapes-auto-lending/
- Auto Remarketing. (2025, July 22). Cox Automotive & FICO tackle complexities of subprime auto finance amid increasing student-loan delinquency. https://www.autoremarketing.com/subprime/cox-automotive-fico-tackle-complexities-of-subprime-auto-finance-amid-increasing-student-loan-delinquency/
6Table 6:
- Bloomberg. (2025, March 26). Car repossessions surge: Americans struggle with auto loan payments. https://www.bloomberg.com/news/articles/2025-03-26/car-repossessions-surge-americans-struggle-with-auto-loan-payments
- Carscoops. (2025, March 28). Car repossessions return to Great Recession levels as 1.7 million vehicles taken back. https://www.carscoops.com/2025/03/car-repossessions-return-to-great-recession-levels-just-in-time-for-another-one/
- Bloomberg. (2025, March 26). Car repossessions surge: Americans struggle with auto loan payments. https://www.bloomberg.com/news/articles/2025-03-26/car-repossessions-surge-americans-struggle-with-auto-loan-payments
- Newsweek. (2025, October 20). Car repossessions approaching record high as delinquency rates soar. https://www.newsweek.com/car-repossessions-approaching-record-high-as-delinquency-rates-soar-10908518
7Table 7:
- Experian. (2026). Average car payment. https://www.experian.com/blogs/ask-experian/average-car-payment/
- Experian. (2026). Average car payment. https://www.experian.com/blogs/ask-experian/average-car-payment/
- Insurify. (2026, February 3). Average car price in 2026: New, used, and monthly payments. https://insurify.com/car-insurance/knowledge/average-cost-car/
- Insurify. (2026, February 3). Average car price in 2026: New, used, and monthly payments. https://insurify.com/car-insurance/knowledge/average-cost-car/
- DefiSolutions. (2026, February 20). Auto loan delinquency rates and trends. https://defisolutions.com/defi-insight/auto-loan-delinquency-rates-and-trends/