US Car Repossessions Surge to Near 2008 Levels Amid Rising Auto Costs

In 2024, car repossessions in the U.S. have surged to nearly 1.73 million, reaching levels comparable to the post-2008 financial crisis period. This increase is attributed to record-high vehicle prices combined with ongoing inflation, which challenges many consumers' ability to keep up with monthly auto loan payments, averaging $745 for new cars and $521 for used ones. Repossessions typically occur 90 to 120 days after missed payments, but for borrowers with subprime loans, repossession can happen within 30 days of the first missed payment. This situation affects more than just transportation access; it also significantly impacts credit scores, often causing a drop of about 100 points and complicating financial recovery. Experts advise borrowers experiencing payment difficulties to communicate promptly with lenders, who might offer payment modifications or temporary relief. Lenders have the right to repossess vehicles at any time under contractual terms, and reclaiming a repossessed vehicle requires paying the owed balance plus additional fees. Failure to reclaim leads to the vehicle being sold by the lender.