Younger Borrowers Falling Behind in Car Payments
Jerry research reveals their delinquency rates rival those of the financial crisis of 2008 and 2009.

Federal data from the first quarter also shows borrowed amounts decreased.
Andrea Piacquadio, Pexels
An analysis of Federal Reserve data by car insurance comparison application Jerry reveals that millennial and generation Z borrowers are falling behind on their car payments at rates previously observed during the financial crisis of 2008 and 2009.
The quarterly household debt report of the Federal Reserve, which utilizes Equifax data to derive its auto loan delinquency numbers, categorizes borrowers according to age brackets that include 18 to 29 and 30 to 39 years.
According to the report, which covers the period from 2000 to the first quarter of 2023, those age ranges have historically exhibited greater delinquency rates than the national average.
The statistical data across that period shows that the rate of auto loan borrowers who were overdue by 90 days or more was 3.58% for the 18 to 29 age group and 2.62% for the 30 to 39 age group, compared to the average rate of 2.13% for overdue borrowers across all age groups.
For the first quarter of 2023, the study showed the 90-day delinquency rate was:
4.55% for 18- to 29-year-olds, the highest since the fourth quarter of 2009.
3.06% among 30- to 39-year-olds, the worst since the third quarter of 2010.
“Delinquencies are rising at a blistering pace,” Jerry data journalist Henry Hoenig wrote in the June 2 Jerry report. The growth between the first quarter of 2022 to the first quarter of 2023 was termed by him as the steepest in 23 years. Hoenig said the year-over-year increase observed in the first quarter of 2023 among consumers ages 30 to 39 was the most significant bump since 2007.
“The surge in delinquencies coincides, perhaps not surprisingly, with a steep drop in new auto loans, particularly among borrowers with lower credit scores,” Hoenig wrote.
According to his analysis, the federal data shows that in the first quarter, borrowed amounts decreased:
25% among consumers ages 18 to 29
17% in the 30 to 39 age group
18% in the 40 to 49 age group
However, Hoenig observed the reduction in amounts borrowed for vehicles could be because lenders have adopted more stringent lending policies in recent months.
Originally posted on Auto Dealer Today
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