Despite sluggish auto sales last year, consumer auto debt is still increasing significantly, according to a report from WalletHub.
U.S. auto sales were slower in 2024, up just 2% over 2023, due to inflation. But auto loan balances increased by $13 billion in the second quarter of this year, according to a report from the Federal Reserve Bank of New York.
WalletHub looked at the median auto loan balance in 2,500 U.S. cities to see where Americans are taking on the most car debt.
“Many Americans are overspending on cars,” said Chip Lupo, WalletHub analyst, in a statement. “In over 160 cities, the average resident’s auto loan debt is the equivalent of half or more of their yearly income.”
Drivers can reduce their debt by buying less-expensive cars, used cars or waiting to buy a car until they’ve saved up enough money to avoid or minimize a loan.
“Residents dealing with these expensive loans on top of debt from credit cards, personal loans, student loans and mortgages are at risk of falling behind on payments and having their vehicles repossessed,” Lupo said.
The slideshow above highlights the six cities with the most auto loan debt, according to WalletHub’s analysis.
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