Yes, collecting payments on subprime auto loans has become
more challenging in recent years. Delinquency rates among subprime borrowers
have risen significantly, reaching levels not seen in decades. For instance, as
of January 2025, 6.6% of subprime auto borrowers were at least 60 days overdue
on their loans, the highest rate in decades.
Axios
Several factors contribute to this trend:
- Economic
Pressures: Rising interest rates and inflation have increased the cost
of car ownership, making it harder for subprime borrowers to keep up with
payments.
Georgetown Law
- Loan
Abandonment: Some subprime borrowers are choosing to default on their
current loans to obtain new ones with more favorable terms, leading to
higher delinquency rates.
collectionsandrecovery.com
- Lender
Challenges: Lenders specializing in subprime auto loans have faced
increased defaults, with some even collapsing under the strain.
Georgetown Law
These developments have made it more difficult for lenders
to collect payments on subprime auto loans, reflecting broader economic
challenges affecting both borrowers and lenders.
This is why it makes sense to entrust your current or
collect-out portfolios with the trusted professionals of AutoCollect Solutions!
Over 70 years of combined subprime collection experience with proven results.
