The Auto Loan Breakdown: $1000/month Car Payment Economy
By the Numbers and On the Ground: From Auction Floors to ABS Reports: The Auto Credit Crisis Unfolds
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Wrecked: What We’re Hearing Matches the Math
Auto loan stress is building across the system, and the data now confirms what dealers, lenders, and auction insiders have been warning.
Auto delinquencies are rising to record levels. Loan terms are stretching past 84 months. Regional disparities in debt burden and payment rates are widening. And behind the scenes, dealers are watching trade-ins fail, repossessions rise, and lenders tighten access to credit.
In this edition of The Pre-Mortem Brief, we combine real-time insights from industry sources with loan-level preliminary data from ABS filings (which are currently being worked on and will be available to clients as they become complete). The result: a clear picture of a consumer credit segment under mounting structural pressure with implications for banks, securitizations, and household balance sheets alike.
We have been following the auto sector and the dealership space for over two years. Our source(s) — a seasoned expert straddling auction floors and dealer desks— offered a brutal bottom-up picture of what’s unfolding. Here is our take.