Auto Loan Delinquency Growth To Slow In 2026

Auto loan delinquencies in the U.S. are still expected to rise in 2026, but the pace of that increase is projected to slow compared with 2025.​

Headline outlook for 2026

TransUnion’s 2026 Consumer Credit Forecast projects that auto loans 60+ days past due will reach about 1.54% by Q4 2026, only 3 basis points higher than the forecasted Q4 2025 level, marking the fifth straight year of increases but with progressively smaller annual upticks. Industry coverage notes this as “auto loan delinquency growth to slow in 2026,” meaning stress is still building but at a more moderate rate than in recent years.​

Why growth is slowing

Analysts attribute the moderation to several factors: consumers are prioritizing auto payments in their budgets, vehicle price inflation has cooled from earlier peaks, and lenders have tightened or refined underwriting after the post‑pandemic run‑up in risk. At the same time, high balances, long loan terms, and pockets of labor‑market cooling keep delinquency pressure from actually reversing, which is why forecasters still expect another small increase rather than a decline.​

Context vs recent years

Federal Reserve research shows that auto delinquency rates had started to flatten through mid‑2025 before ticking higher again in 2025 Q3, suggesting the worst acceleration phase may be past but vulnerabilities remain. Market commentary emphasizes that, unlike an outright credit crisis, current projections imply manageable but persistent strain for subprime borrowers and for lenders and investors in auto ABS, with performance expected to weaken modestly rather than sharply.​