Consumers are already under pressure from a growing number of financial factors related to car ownership, including as increased insurance costs and car prices that are significantly higher than before the pandemic.
According to data gathered by Cox Automotive, lenders have become more selective about the people they will lend to following the recent turmoil in the banking industry, with the auto loan decline rate rising to 9.1% in February, the highest since 2017, according to the Federal Reserve Bank of New York. For those who can get credit, the average interest rate on a new car has increased by about 3 points to almost 9% over the past year.
More people are missing automobile payments as a result of the escalating costs of car ownership. More people are defaulting on their car payments as a result of rising auto costs, while organizations who assist those looking to purchase a car report greater difficulty meeting demand as a result of their own pressures. The state of the auto market could have an even greater influence on the economy given how crucial a car is to getting and retaining a job in the majority of the nation.
According to John Van Alst, director of the Working Families Institute, “The current job market allows many people to find employment, but the most significant obstacle in their way is reliable transportation and a car to travel to and from work.”The National Consumer Law Center’s project Vehicles for Working Families. When there are great work options, it is extremely frustrating.
One of the people who struggled to purchase a car was Iyona Anderson, a single mother from Maryland who works as a pharmacy technician. Although 27-year-old Anderson has the means to pay the $12,000 loan’s monthly payments, she hasn’t been able to find a dependable automobile in that price range and has been repeatedly denied because she had credit issues when she was younger. Younger people who want to purchase a car will find it extremely challenging to do so without the proper knowledge of financing, especially in today’s market, Anderson added. Also, when you visit the dealership,