USMacroBETA

All-Loans Delinquency Rate (Banks)

Positive
CURRENT VALUE
1.38%
Source: Federal Reserve via FRED
Data through: Q2 2026 · updated Aug 26 · Updates: Quarterly
↓ 0.1 pp YoY
Historical context: Currently in the 6th percentile — near historically low/favorable levels.
What this means right now: Auto loan delinquency is at healthy levels — the auto lending market is stable. Consumer financial stress from auto debt is manageable and not signaling broader economic concern.
All-Loans Delinquency Rate (Banks) · Quarterly · 1985–2026
Grey areas = NBER recessions · Scroll to read · zoom and pan in Expand
Monthly values

All-Loans Delinquency Rate (Banks) — the last 8 quarters

Every quarter's reading, with the band the heatmap gives it. The chart above shows the same series in full.

QuarterValueBand
Q2 20261.38%Healthy reading
Q1 20261.46%Healthy reading
Q4 20251.50%Within normal range
Q3 20251.44%Healthy reading
Q2 20251.44%Healthy reading
Q1 20251.53%Within normal range

Quarter-end readings of the same series the chart shows, from auto_delinquency_rate. Values are the current record, not point-in-time: a month that has since been revised shows its revised value.

What is the Auto Delinquency?

This series measures the percentage of ALL loans at all US commercial banks that are 30 or more days past due — every loan category combined: residential and commercial real estate, credit cards, other consumer loans, and commercial and industrial lending (FRED: DRALACBN). It is quarterly and, unlike its sibling delinquency series on this site, not seasonally adjusted. A note on this page's history: this indicator was previously titled "Auto Loan Delinquency" — the underlying data has always been the all-loans series; the title was corrected in July 2026 (the data itself is unchanged). As the broadest bank-loan delinquency measure, it summarizes credit stress across the whole lending book rather than any single borrower segment.

How We Color-Code the Auto Delinquency

Our heatmap colors each indicator based on historically significant thresholds:

Below 1.0%
Very low — consumers financially healthy, bank loans performing well
1.0% – 1.5%
Low — bank loan market stable, manageable consumer stress
1.5% – 2.0%
Moderate — some consumer financial pressure
2.0% – 2.5%
Elevated — meaningful consumer stress, auto market under pressure
Above 2.5%
High — significant consumer financial distress

Historical Extremes — What Happened Next?

When this indicator reaches extreme levels, history shows consistent patterns:

Q4 2010Financial Crisis Peak
6.81%
Highest auto delinquency in modern history during the financial crisis — as unemployment peaked at 10%, consumers struggled with all debt obligations.
Q2 2021COVID Stimulus Low
1.27%
Near-historic low as government stimulus checks and enhanced unemployment benefits temporarily eliminated consumer financial stress.
2023-2026Post-COVID Stress Rise
Loan delinquency approaching 2.5%+
Rising toward multi-decade highs as consumers who purchased vehicles at peak prices with high-rate loans face affordability stress — particularly affecting subprime borrowers.

Investor Checklist — Current Reading

Based on the current Auto Delinquency reading of 1.38% (Positive):

✓Stable auto market — manageable consumer stress, maintain consumer sector exposure

Frequently Asked Questions

Why are loan delinquencies a useful early warning of consumer stress?
Bank loans occupy a unique position in consumer financial prioritization. Consumers typically pay bank loans after mortgages but before credit cards and student loans — because losing a car often means losing the ability to get to work. Rising loan delinquencies therefore signal serious financial stress that has already gone through other coping mechanisms (using savings, borrowing from family, reducing credit card payments).
Why have loan delinquencies risen so much after COVID?
A perfect storm of factors: (1) vehicle prices surged 30-40% during the chip shortage; (2) interest rates on new bank loans rose from 3-4% to 7-8%; (3) combined monthly payments on expensive vehicles with high-rate loans exceeded what many buyers could sustain long-term; (4) COVID stimulus masked the problem temporarily. Buyers who stretched to purchase vehicles in 2021-2022 are now struggling with payments.
What happens when auto delinquency is very high?
Lenders repossess vehicles from delinquent borrowers, flooding the used car market with supply. This pushes down used car prices, further reducing the value of vehicles serving as collateral for outstanding loans (creating negative equity situations). Auto lenders face rising credit losses. The cycle can become self-reinforcing as falling used car values reduce the incentive for underwater borrowers to continue paying.
Why are bank loan delinquencies rising even when unemployment remains relatively low?
Auto loan stress can build independently of the unemployment rate when vehicle prices and loan sizes rise faster than incomes — a dynamic that played out sharply after 2020 when pandemic-era supply shortages drove used car prices up 40–50%. Borrowers who took out large loans at high prices on vehicles that subsequently depreciated can become underwater on their loans even while employed. This makes auto delinquency a useful indicator of consumer balance sheet stress that is distinct from job loss.
How does subprime bank loan delinquency compare to the aggregate rate tracked here?
The aggregate DRALACBN series from FRED tracks delinquency across all bank loans at commercial banks, blending prime and subprime borrowers. Subprime auto delinquency (borrowers with credit scores below 620) typically runs 3–5 times higher than the aggregate rate and tends to be the leading edge of deterioration — rising first when conditions tighten and falling last when they improve. The aggregate rate tracked here provides a system-wide read, but a sharp rise in this number typically understates what is happening at the subprime margin.