{"id":18236,"date":"2016-02-25T13:12:25","date_gmt":"2016-02-25T18:12:25","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18236"},"modified":"2016-02-25T13:12:25","modified_gmt":"2016-02-25T18:12:25","slug":"the-subprime-auto-loan-meltdown-is-here","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18236","title":{"rendered":"The Subprime Auto Loan Meltdown Is Here"},"content":{"rendered":"<div class=\"post-headline\">\n<h3><a href=\"http:\/\/theeconomiccollapseblog.com\/archives\/the-subprime-auto-loan-meltdown-is-here\" target=\"_blank\">The Subprime Auto Loan Meltdown Is Here<\/a><\/h3>\n<\/div>\n<div class=\"post-byline\"><\/div>\n<div class=\"post-bodycopy clearfix\">\n<p><a href=\"http:\/\/theeconomiccollapseblog.com\/archives\/the-subprime-auto-loan-meltdown-is-here\/debt-loans-auto-loans-public-domain\" rel=\"attachment wp-att-9885\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-9885\" src=\"http:\/\/theeconomiccollapseblog.com\/wp-content\/uploads\/2016\/02\/Debt-Loans-Auto-Loans-Public-Domain-460x310.jpg\" alt=\"Debt Loans Auto Loans - Public Domain\" width=\"460\" height=\"310\" \/><\/a>Uh oh \u2013 here we go again.\u00a0 Do you remember the subprime mortgage meltdown during the last financial crisis?\u00a0 Well, now a similar thing is happening with auto loans.\u00a0 The auto industry has been doing better than many other areas of the economy in recent years, but this \u201cmini-boom\u201d was fueled in large part by customers with subprime credit.\u00a0 According to Equifax, an astounding 23.5 percent of all new auto loans were made to subprime borrowers in 2015.\u00a0 At this point, there is a total of somewhere around $200 billion in subprime auto loans floating around out there, and many of these loans have been \u201crepackaged\u201d and sold to investors.\u00a0 I know \u2013 all of this sounds a little too close for comfort to what happened with subprime mortgages the last time around.\u00a0 We never seem to learn from our mistakes, and a lot of investors are going to end up paying the price.<\/p>\n<p>Everything would be fine if the number of subprime borrowers not making their payments was extremely low.\u00a0 And that was true for a while, but now delinquency rates and default rates are rising to levels that we haven\u2019t seen since the last recession.\u00a0 The following comes from\u00a0<a title=\"Time Magazine\" href=\"http:\/\/time.com\/money\/4233873\/subprime-car-loans\/\" target=\"_blank\">Time Magazine<\/a>\u2026<\/p>\n<blockquote><p>People, especially those with shaky credit,\u00a0<strong>are having a tougher time than usual making their car payments<\/strong>.<\/p>\n<p>According to Bloomberg,\u00a0<strong>almost 5% of subprime car loans that were bundled into securities and sold to investors are delinquent, and the default rate is even higher than that<\/strong>. (Depending on who\u2019s counting, delinquency is up to three or four months behind in payments; default is what happens after that). At just over 12% in January, the default rate jumped one entire percentage point in just a month. Both delinquency and default rates are now the highest they\u2019ve been since 2010, when the ripple effects of the recession still weighed heavily on many Americans\u2019 finances.<\/p><\/blockquote>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The Subprime Auto Loan Meltdown Is Here Uh oh \u2013 here we go again.\u00a0 Do you remember the subprime mortgage meltdown during the last financial crisis?\u00a0 Well, now a similar thing is happening with auto loans.\u00a0 The auto industry has been doing better than many other areas of the economy in recent years, but this [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[12623,3891,7661,175,5983,3894,312,6065,2541,488,4901,8818,2339,3601,12624,2562,12625,12626,12627,12628,7288],"class_list":["post-18236","post","type-post","status-publish","format-standard","hentry","category-economics","tag-auto-loan","tag-auto-loans","tag-borrowers","tag-credit","tag-economiccollapseblog","tag-equifax","tag-financial-crisis","tag-investors","tag-loan","tag-loans","tag-michael-snyder","tag-mortgage","tag-mortgages","tag-subprime","tag-subprime-auto-loan","tag-subprime-auto-loans","tag-subprime-borrowers","tag-subprime-credit","tag-subprime-mortgage","tag-subprime-mortgage-meltdown","tag-subprime-mortgages"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18236","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18236"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18236\/revisions"}],"predecessor-version":[{"id":18237,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18236\/revisions\/18237"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18236"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18236"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18236"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}