The exorbitant cost of vehicles and auto insurance isn’t just breaking Americans’ banks — it’s now breaking their credit score, too. According to data from Fitch Ratings, a record number of subprime auto borrowers — Americans with poor to fair credit scores — are falling behind on their car payments.

• In January, 6.6% of subprime borrowers were 60 days behind on their vehicle loan, pushing delinquencies to the highest level since Fitch’s dataset began in Aug. 1991.
• Fitch said that “Subprime auto loans face a deteriorating outlook for 2025,” dogpiling onto recent stress indicators such as credit card delinquencies and late payments.

Fork in the road: However, Fitch’s findings come with a big asterisk. Although subprime borrowers are facing unprecedented stress, prime borrowers with credit scores over 670 seem to be doing just fine. Their delinquency rate is just 0.39%, only marginally higher than in Jan. 2024, showing that more credit-worthy consumers have been able to saddle vehicle costs. It’s another indication of the so-called K-shaped recovery, whereby the pandemic detached the economic well-being of low, middle, and upper-class Americans. Fitch warns that low-income borrowers will likely remain affected throughout 2025, potentially impacting auto lenders.