Auto loan debt grew in the first quarter, driven primarily by borrowers in the lowest credit tiers, according to the Federal Reserve Bank of New York.
Total auto loan debt in the U.S. rose 4 percent year over year to $1.28 trillion in the quarter, according to the central bank's Household Debt and Credit Report released Tuesday. Auto originations — loans and leases for new and used vehicles — grew 6.3 percent to $139 billion in the quarter.
Subprime borrowers, or those with credit scores below 620, contributed the most growth from the prior year, with originations up 13 percent to $27.9 billion, according to the New York Fed. Subprime borrowers were responsible for about 20 percent of auto loan balances in the quarter, up from 19 percent in 2018.