Auto loan delinquencies increasing

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The payment squeeze.
Welcome to the Know the Difference Minute for Thursday, December 29th.
VantageScore is a data analytics firm that tracks credit usage. It reports the average credit card balance for November was almost $5,700, the highest in the last 12 months.
Consumer spending was steady through most of 2022—but rising interest rates create payment challenges. The average credit card interest rate in the 3rd quarter was over 16%.
More concerning is the uptick in auto loan delinquencies which are up both month-to-month and year-to-year. While delinquencies are still in line with pre-pandemic levels, interest rates aren’t. That will put additional pressure on borrowers.
According to a Congressional Budget Office study, the middle-class is being hit the hardest. Purchasing power from paychecks fell 2.9% for middle-income households in 2022 while rising 1.5% for the bottom fifth and 1.1% for the top.
I’m Dave Spano from Annex Wealth Management. That is your Know the Difference Minute.