Auto Loan Balances Climb In Key Markets, Creating New Risk Signals For Lenders
By CU Today Staff —
MIAMI--U.S. consumers now hold approximately $1.7 trillion in outstanding auto loan debt, and average balances continued to rise in many major metropolitan areas during the first quarter of 2026, according to a new analysis by WalletHub.
The study found several cities posted sharp quarter-over-quarter increases in average auto loan balances, potentially creating new credit-risk considerations for auto lenders and finance companies.
Among the largest metro areas, Norfolk, Va., recorded the biggest increase in average auto loan balances between the fourth quarter of 2025 and first quarter of 2026, with balances rising nearly 3.2%. Winston-Salem, N.C., followed with an increase of more than 3.1%, while Portland, Ore., North Las Vegas, Nev., Oakland, Calif., and Boise, Idaho, also ranked among the markets with the fastest-growing auto loan debt.
WalletHub analyst Chip Lupo said rising balances can reflect both increased borrowing demand and growing consumer reliance on financing amid elevated vehicle prices and interest rates. The report noted that many of the cities posting the largest debt increases also have relatively high debt delinquency rates, making them markets lenders may want to monitor closely for potential credit deterioration.
The analysis also highlighted substantial differences in loan exposure across markets. Scottsdale, Ariz., had the highest average auto loan balance and monthly payment among the cities studied, at $26,284 and $655, respectively. Irvine, Calif., Fremont, Calif., New York City and Hialeah, Fla., also ranked among the markets with the highest average balances and payments.
For lenders, the findings suggest geographic trends remain an important factor in portfolio management. Markets experiencing rapid growth in average balances may offer stronger origination opportunities, but they could also warrant closer monitoring as higher loan amounts and payment obligations increase sensitivity to economic and employment shifts.
Originally reported by CU Today.