High-risk borrowers are having a hard time paying their auto loans. Last year, 8.7% of these subprime loans had late payers. This year, the number is up to 10.9% and climbing.
The government has provided help with delinquent rent and home loan payments as well as student loan payments but there is no help for car payments. Many high-risk borrowers are at risk of defaulting and losing their cars. Economists are saying that auto loans are a perfect example of the K-shaped recovery in front of us where the wealthier population recovers just fine but the most disadvantaged plunge into further despair.