Consumers with lower credit scores are falling behind on their auto loans at a rapid pace and will likely reach levels not seen since the 2008 financial crisis and recession, said an investment group in a recent note.
Inflation and higher interest rates have been taking chunks out of Americans’ paychecks in recent months, but it is now “very apparent to us that it is negatively affecting subprime borrowers (who tend to have lower credit scores and lower incomes) more harshly than others,” portfolio managers Paul Van Lingen and Ara Balabanian, of fixed-income asset manager Bramshill Investments, wrote to clients in a note, according to multiple news reports.
