The reality is we are less than a decade from the U.S. housing bubble. A bubble created by loose lending practices that were led by the goal of profit over the logic of prudence.

Now we are seeing the same in the auto loan space.

Not this again

Auto loans to subprime borrowers has now surpassed the prior peak made in 2007/2008. You know, that time right before that bubble burst on the credit market.

source

Do the lenders think this time will be different?

I'm not saying that we are currently in an auto loan bubble or that the delinquency rates are getting scary. However, is there not a clear trend what direction this will likely go?

It happened before with the home loan market, if auto loans are being given out all willy nilly with little income documentation needed than the odds fall toward what outcome is all I'm putting out there.

Interesting times indeed.

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Regards,

Thanks for the pic pixabay