There is no need to worry about rising auto debt

debt

What could the consumer expect?

Everyone is by now aware of the fact that there is an increasing number of car loans been approved in the US, but according to specialists there is no need to be concerned about an unexpected recession anytime soon. There has been a slight increase in individual incomes and it is also known that interest rates is currently quite low which could definitely assist vehicle buyers and therefore they should not be a deterioration as far as defaults is concerned.

Even though vehicle debts in the US is now exceeding $1 trillion there is apparently more than enough positive indications so that unnecessary worrying may be unfounded at this stage. During 2015 the total amount of outstanding car loans in the US has for the first time in the history passed the $1 trillion mark. According to statistics this is over 30% more than the levels that were seen before the recession. This is a clear indication of how vehicle sales has soared over the last couple of years. In the same time the borrowing associated with household related expenses has decreased by over 2%. The problem is what about the people were very low credit scores often below 620 that is now approved for vehicle loans? This is people who are struggling financially and yet an increasing number of this people is now approved for vehicle loans. One has to question the logic behind these approval decisions and how it will impact the lives of those people when they simply can no longer pay.

There are other statistics

Although the extraordinary rise in auto loans is already well above the levels which was seen before the recession, there is indications that motor vehicle debt when compared to actual income is still lower than it was before the recession. At first glance this should indicate that borrowers should have less problems when it comes to the payment of those debts but it also has to be considered that there has been significant increases in the prices of other services such as medical care and the cost of everyday living which could still present many consumers with very real financial problems. There is also some economists who are suggesting that the currently peaking motor vehicle debts is in many ways a meaningless statistic and what should be considered is the ability of households to actually pay those debts and this will naturally depend on the disposable income of those households. Fortunately there is still professional debt consolidation assistance available at

There are apparently many positives

There is at least some light at the end of the tunnel because the statistics show that there is significantly more employment opportunities in the US when compared to the situation a decade ago and unemployment rate is currently at less than 5% which is the lowest in eight years. More people are now able to obtain employment as the economy continues to grow. The rates for hourly workers may have shown very little changes in recent years but it was still enough to ensure sufficient incomes which has benefitted the consumer.

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