The American Financial Services Association (AFSA) reported in its newsletter that auto loan approval rates declined in October, despite lenders expanding access through increased subprime lending, longer terms, and reduced down payment requirements.
In October 2025, auto lenders approved a smaller percentage of applicants but broadened access by altering loan structures. Approval rates decreased to 72.6%, while the share of subprime loans rose to 15.1%. Loans with terms of 72 months or more increased to 27.5%, highlighting how affordability pressures are pushing lenders toward longer and riskier credit for many households purchasing vehicles.
According to recent data from the New York Federal Reserve's Quarterly Report on Household Debt and Credit, U.S. auto loan balances remained approximately stable at $1.66 trillion in the third quarter of 2025, even as overall household debt reached $18.6 trillion. This stability indicates that auto credit is still widely available but at payment levels that may strain budgets across various income groups and regions.
Federal Reserve figures cited in recent coverage show that delinquency rates on auto loans—measured as balances at least 30 days past due—reached about 3.8% in June 2024, marking the highest level since 2010. Rising delinquencies across income tiers signal increasing strain on borrowers and highlight the risks associated with looser underwriting and longer loan terms in today's auto market.
Founded in 1916, AFSA is the primary national trade association representing the U.S. consumer credit industry. Its approximately 450 member companies span vehicle finance, traditional installment lending, mortgages, credit cards, industrial banks, and service providers. The association focuses on promoting safe and ethical lending practices while protecting consumers' access to responsible credit at both federal and state levels.