The pandemic caused a spike in used vehicle prices, the reverberations of which we continue to feel today. New data shows that as monthly payments continue to rise, the value of the vehicles as collateral isn’t keeping up, leading to a risky situation for both consumers and lenders.
Data gathered by S&P Global shows that the loan-to-value (LTV) ratio of used vehicles is “stratospherically high” in 2023. In the second quarter of the year, the ratio was at 123% with an average payment for a used car jumping to $533.
According to S&P Global Mobility and TransUnion data:
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