More Americans are upside down on their car loans, and the average amount they owe is at an all-time high, according to a new survey from car comparison site Edmunds.
In the three months ended in September, 24.2% of Americans who traded in their car toward a new vehicle purchase owed more on the trade-in than it was worth, which is considered “upside down” or “underwater,” Edmunds said. That’s up from 23.9% in the prior three months and 18.5% a year ago. Additionally, the amount they owed on those trade-ins climbed to a record high of $6,458, with 22% owing at least $10,000 and 7.5% owing $15,000 or more, it said.
Auto loans account for about 25% of nonmortgage consumer credit, according to the Federal Reserve, and they can provide a window into the financial health of borrowers and overall household financial well-being.
