With a staggering $1.61 trillion now driving the U.S. economy, auto loan debt isn't just a monthly payment—it's a national financial force reshaping how Americans get behind the wheel.
Key Takeaways
- As of Q4 2023, total outstanding auto loan debt in the US reached $1.61 trillion
- Auto loan balances grew by 0.7% in Q4 2023 to $1.61 trillion
- From 2019 to 2023, auto debt increased by 30% to over $1.5 trillion
- Average new auto loan amount was $40,250 in Q4 2023
- Used auto average loan size $26,140 in Q4 2023
- Average auto loan term reached 69.6 months for new cars in 2023
- Average APR for new auto loans was 7.18% in Q4 2023
- Used auto loan APR averaged 11.35% Q4 2023
- Superprime new car APR 5.23% average 2023
- 45% of US adults have auto loans with avg APR 9.1% 2023
- 54% of new car buyers financed in 2023
- Millennials hold 34% of auto loan debt despite 22% population
- Overall US auto delinquency rate 2.64% Q4 2023
- Subprime delinquency 5.31% 60+ days Q4 2023
- New auto delinquencies up 50bps to 1.9% Q3 2023
US auto loan debt has surged to $1.6 trillion with more borrowers facing higher payments.
Average Loan Amounts and Terms
- Average new auto loan amount was $40,250 in Q4 2023
- Used auto average loan size $26,140 in Q4 2023
- Average auto loan term reached 69.6 months for new cars in 2023
- 20% of new auto loans in 2023 were over 72 months
- Average used car loan term 67.8 months Q3 2023
- Superprime borrowers average loan $45,000 new autos 2023
- Subprime used loan average $20,500 in 2023
- Refinance auto loans averaged $28,000 in 2023
- EV new auto loans averaged $48,000 in Q4 2023
- 15-year auto loans now 5% of originations 2023
- Average down payment new cars 10.2% or $5,500 in 2023
- Used car down payments averaged 11.8% in Q3 2023
- Loans under $20,000 22% of used market 2023
- Jumbo auto loans over $50,000 18% new vehicles 2023
- Average monthly payment new autos $742 in 2023
- Used auto monthly payments averaged $520 Q4 2023
- 72-month loans average amount $35,500 new 2023
- Prime borrowers avg term 68 months used cars 2023
- Deep subprime avg loan $15,200 used 2023
- Lease buyouts average $25,000 in 2023
- Average loan-to-value new autos 115% in 2023
- Used LTV averaged 126% Q3 2023
- Balloon payment loans 3% of market avg $30k 2023
- Average new auto loan Q1 2024 $41,000+
- 60-month loans avg $32,000 used 2023
- Millennial avg auto loan $28,500 2023
Average Loan Amounts and Terms Interpretation
The sobering math of modern car ownership means we're taking out seven-year mortgages on rapidly depreciating assets, often borrowing more than they're worth, to drive off the lot with a payment that feels like a second rent check.
Borrower Demographics
- 45% of US adults have auto loans with avg APR 9.1% 2023
- 54% of new car buyers financed in 2023
- Millennials hold 34% of auto loan debt despite 22% population
- Gen Z auto loan penetration 25% up from 18% in 2022
- Women borrowers 48% of auto loans but avg smaller amounts 2023
- Superprime borrowers 47% of new originations 2023
- Subprime share of used loans 20% in Q4 2023
- Average FICO for new auto loans 765 in 2023
- 28% of subprime borrowers 90+ days delinquent 2023
- Black households auto debt 1.5x white households adjusted income 2023
- 62% of households earning <$50k have auto loans 2023
- Boomers avg FICO 740 for auto loans 2023
- Urban borrowers 55% of auto loan volume 2023
- First-time buyers 15% of new loans avg FICO 710 2023
- Hispanic borrowers 18% of market share 2023
- Self-employed 12% higher rejection rates auto loans 2023
- 35-44 age group highest auto debt $15k avg 2023
- College grads 2x more likely to finance luxury autos 2023
- Single borrowers 40% of subprime segment 2023
- Rural areas 22% higher used loan reliance 2023
- 760+ FICO avg income $120k for auto loans 2023
- Veterans 8% of auto loans avg longer terms 2023
- Gig workers rejection rate 25% auto financing 2023
- 25-34yo 30% of new originations 2023
- Low-income (<$35k) 35% subprime auto loans 2023
- Female-headed households avg $10k more debt 2023
Borrower Demographics Interpretation
The American auto loan landscape is a tale of two credit scores: while superprime borrowers are comfortably cruising in new cars, a rising tide of younger, urban, and lower-income buyers is navigating rougher financial waters with longer terms and higher rates just to keep pace.
Delinquency and Default Rates
- Overall US auto delinquency rate 2.64% Q4 2023
- Subprime delinquency 5.31% 60+ days Q4 2023
- New auto delinquencies up 50bps to 1.9% Q3 2023
- Used auto 90-day delinquency 4.2% end 2023
- Prime delinquency steady at 1.8% Q4 2023
- Deep subprime 90+ days 11.5% Q3 2023
- Serious delinquency (90+) overall 3.8% used loans 2023
- EV loan delinquencies 0.5% lower than gas 2023
- 2023 subprime new delinquency peaked at 4.9%
- Credit union auto delinquencies 1.2% Q4 2023
- Buy-here-pay-here default rates 25% annual 2023
- Gen Z delinquency 4.1% vs avg 2.7% 2023
- Transition to delinquency 60-day rate 1.65% Q4 2023
- Foreclosure starts on autos up 10% YoY 2023
- Negative equity linked to 40% higher delinquency 2023
- Long-term loans (>72mo) delinquency 3.2% 2023
- Regional variation: South 3.1% delinquency vs Northeast 2.1% 2023
- Refinance lowered delinquency by 15% for participants 2023
- Subprime used 30+ days 12.4% Q4 2023
- Overall default rate 1.2% auto loans 2023
- Millennial delinquency 3.0% avg 2023
- Charge-off rates subprime 5.8% Q3 2023
- 72-month loans 2.8% delinquency rate 2023
- Post-COVID delinquency recovery to 2.5% by mid-2023
- Low FICO (<620) 8.2% serious delinquency 2023
- Auto repossessions rose 20% YoY to 1.7 million in 2023
- Subprime repossessions 127,000 in Q4 2023
- Repo rates per 1,000 loans 3.5 overall 2023
- Used vehicle repos up 23% to 1.4M in 2023
- New auto repos minimal at 0.8 per 1,000 2023
- Subprime repo rate 15.2 per 1,000 Q4 2023
- States with highest repos: Texas 180k in 2023
- EV repos 30% below average due to value retention 2023
- Buy-here-pay-here repos 40% of inventory turnover 2023
- Repo auctions averaged $14,500 per vehicle 2023
- Delinquent loans entering repo 45 days avg 2023
- Prime borrower repos 0.4 per 1,000 2023
- Negative equity vehicles 25% more likely repossessed 2023
- Repo recovery rates 55% LTV avg 2023
- Q1 2024 repos up 5% QoQ to 350k
- Long-term loan repos 1.8x higher 2023
- Gen Z repos 2x millennial rate 2023
- Credit unions repo rate 1.1 per 1,000 2023
- Urban areas 60% of national repos 2023
- Post-repo deficiency balances avg $8,200 2023
Delinquency and Default Rates Interpretation
While America's prime borrowers are cruising along steadily, a disturbing number of subprime drivers—particularly in used, long-term loans—are sputtering towards a financial cliff, creating a two-lane economy where the repossession lane is getting uncomfortably crowded.
Interest Rates and APRs
- Average APR for new auto loans was 7.18% in Q4 2023
- Used auto loan APR averaged 11.35% Q4 2023
- Superprime new car APR 5.23% average 2023
- Subprime used APR hit 16.85% in Q3 2023
- Prime borrowers new auto APR 6.75% Q4 2023
- Deep subprime APRs over 18% for 70% of loans 2023
- Refinance APR savings averaged 2.1% in 2023
- EV financing APR 0.9% lower than ICE 2023
- 84-month loans APR averaged 8.2% new 2023
- Credit union auto APRs 1.5% below banks 2023
- Online lender APRs averaged 9.8% used cars 2023
- Fed rate hikes pushed auto APRs up 4% since 2022
- Nonprime APRs 14.2% average Q3 2023
- 0% APR deals 12% of new sales 2023
- Average interest paid over loan life $9,200 new 2023
- Used superprime APR 7.1% Q4 2023
- Dealer-arranged loans APR 2% higher than direct 2023
- Gen Z subprime APR averaged 15.5% 2023
- Fixed vs variable APR 95% fixed in auto loans 2023
- Average auto loan rate forecast 7.5% for 2024
- Buy-here-pay-here APRs exceed 20% average 2023
- Prime used APR 8.45% end 2023
- 48-month loans APR 6.9% new cars 2023
- 37% of borrowers with 700+ FICO got under 6% APR 2023
Interest Rates and APRs Interpretation
This sobering parade of numbers reveals a financial caste system on wheels, where your credit score dictates not just your monthly payment but your very dignity, proving that while all cars may depreciate, the cost of financing one is a brutally efficient measure of societal standing.
Market Size and Growth
- As of Q4 2023, total outstanding auto loan debt in the US reached $1.61 trillion
- Auto loan balances grew by 0.7% in Q4 2023 to $1.61 trillion
- From 2019 to 2023, auto debt increased by 30% to over $1.5 trillion
- In 2023, auto loans accounted for 9.3% of total consumer debt at $1.58 trillion
- Q3 2023 saw auto loan debt at $1.58 trillion, up 8.7% year-over-year
- By end of 2022, US auto loan balances hit $1.52 trillion
- Auto debt surged 12% in 2022 to $1.49 trillion
- 2023 average new vehicle financing was 85% of transactions
- Total auto loans originated in 2022 exceeded $700 billion
- Captive finance share of new auto loans was 32% in 2023
- Bank-originated auto loans grew 5% YoY in Q3 2023
- Credit union auto loans outstanding reached $140 billion in 2023
- Prime auto loan originations hit $285 billion in 2023
- Subprime auto loans totaled $170 billion outstanding in Q3 2023
- Used auto loan balances were $682 billion in Q4 2023
- New auto loan debt stood at $928 billion end of 2023
- Auto loan market projected to grow to $2 trillion by 2027
- 112.7 million auto loans outstanding as of Q3 2023
- Average household auto debt $11,184 in 2023
- 42% of US households had auto loans in 2023
- Auto loans comprised 8.9% of GDP in consumer credit 2023
- 2023 saw $500 billion in new auto lending volume
- Finance companies hold 15% of auto loan market share 2023
- Regional banks auto lending up 4% in 2023
- Online lenders captured 10% of auto loans in 2023
- EV auto financing volume reached $50 billion in 2023
- Lease financing was 28% of new vehicle transactions 2023
- Total securitized auto loans $250 billion in 2023
- Millennials hold 40% of auto loan debt 2023
- Gen Z auto loans grew 25% YoY in 2023
Market Size and Growth Interpretation
Americans are now so deeply indebted to their cars that a significant portion of the population is essentially leasing their freedom from a bank parking lot.
Sources & References
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