Auto Loan Defaults Won’t Surge In Near Future: Capital Economics

Though the nominal dollar value of auto loans outstanding is above its pre-recession level, the loans to disposable income ratio and interest rates are below their 2007 level, and hence, auto loan defaults won’t surge any time soon, reports Capital Economics. Paul Ashworth said in his March 7 report titled “Is the rise in auto loans a concern?” that he anticipates that the Fed will resume raising interest rates in June. Auto loans surge faster than household debt and student loans Underscoring the rapid surge in the growth of auto loans in recent years, Ashworth points out that the surge in new…