The Repo Line

Serious delinquency on auto loans — balances 90 or more days past due — reached 5.6% in Q1 2026, according to the Federal Reserve Bank of New York. That is a series record, and up from 3.98% at the end of 2021. Unlike mortgages, where forbearance programs provided a buffer, auto loans received no comparable relief, making them an early and unfiltered signal of household financial stress.

Auto loans occupy a unique position in the household balance sheet. Borrowers typically prioritize car payments above credit cards and even some utility bills, because losing a vehicle means losing the ability to get to work. When auto loan delinquency rises to these levels, it signals that borrowers have already exhausted other options. Falling Behind confirms the broader picture: total delinquency across all consumer debt is rising in step.

The surge in auto loan distress traces directly to the pandemic-era vehicle market. Buyers who purchased vehicles in 2021–2022 paid inflated prices and, as rates rose, locked in higher monthly payments. The Card Tax illustrates the broader rate environment as credit card APRs add to the pressure. For households already managing elevated credit card debt, an underwater auto loan becomes the breaking point. Pink Slips adds another dimension: January 2026 saw the worst start-of-year layoff announcement total in many years, compounding the pressure.