Healthy Food Delivery : How Americans Ended Up With $1.6 Trillion in Car Debt (And Why It’s Getting Worse)

Thursday, May 14, 2026

How Americans Ended Up With $1.6 Trillion in Car Debt (And Why It’s Getting Worse)

Many Americans live somewhere where driving is a necessity. As nice as it would be for everyone to live in 15-minute cities, the unfortunate reality is that most U.S. infrastructure forces many people to need cars. And that often means financing a car. Recent studies have found that Americans carry a lot of auto loan debt, around $1.68 trillion. Sure, some of that is because cars are getting more and more expensive, but is there more to this number than that?

How Big of a Deal Is Auto Loan Debt?

To start, let’s put that $1.68 trillion into perspective. In a new report, Fortune notes that nearly “one in four Americans are paying off auto debt.” The report then says that this number is “on par with all outstanding federal student loan debt ($1.69 trillion of federal debt and $1.84 trillion total) and ahead of credit card balances ($1.28 trillion outstanding as of last year).” In fact, according to the numbers, “cars are rivaling everything else in terms of debt bondage for everyday Americans.”

Why Do Americans Have So Much Auto Loan Debt?

Some of this debt can be blamed on rising prices. Fortune notes that automobiles in particular are an example of “an item that has fast outpaced inflation since the pandemic.” Compared to 2018, the average monthly car payment has risen roughly 40%, from $506 to $680. For lower-income households, the overall car debt may also be bigger due to the need to “spread payments out over longer periods.” When the average car price is “almost $50,000, a 30% increase since 2019,” it’s sometimes necessary to take out a seven-year or longer auto loan, and that means paying far more in interest.

The used-car market is also seeing higher prices, limiting consumers’ options. Fortune reports that “while used car inflation has moderated somewhat since its peak in 2022, prices are still 29% higher than before the pandemic.” Shopping around on Facebook Marketplace or other third-party sites may still prove fruitful, but it’s not without its risks. Many sellers prefer to be paid in full in cash, which may not always be feasible. And with the rise of generative AI, scam listings are more prolific than ever.

Fortune also reports that there’s been a significant change in who’s buying new cars. “Last year, just 37% of people in the market for a new car had salaries smaller than six figures, down from 50% in 2020,” they report. This is in contrast to high-earners, where “the share of buyers with incomes exceeding $200,000 rising from 18% to 29% over the past six years.”