The inflation that was rampant during the years of Joe Biden's presidency caused big increases in car repair costs, insurance premiums and fuel prices, and one expert says these are reasons the number of auto repossessions are increasing today.
Ray Shefska is co-founder of CarEdge, a car buying service that helps with research and negotiations, and he says part of the problem people are having in keeping up with payments is, they mistakenly buy based on immediately-affordable monthly payments. But things change.
The latest Federal Reserve statistics show nearly 16-percent of "subprime" borrowers are late with their car payments. Those are people with less-than-good credit scores.
And nearly 4-percent of all auto loans fell into delinquency in the third quarter of 2025.
But a dream car with an affordable monthly payment may drag on for 5, 7 or more years, and in that time changes may come in a person's ability to pay, which is subject to employment ups and downs, changes in family expenses and other causes.
A more practical car, though, might have the same monthly payment but the payoff could come in as little as four years, for example.
"People need to look in the mirror," Shefska advises, "and decide what they can live with and what they can live without. And they'll find that what they need is a lot less expensive than what they want."
As inflation threatens to ramp up again, the car payments may stay the same but repair costs rise and so do insurance costs -- and now fuel.
"They don't have the money to handle the car payment -- plus the maintenance. It's a recipe for disaster."
Both individuals and families are being hit all around, Shefska says.
"People are getting hit with higher costs everywhere, it's not just the price of the car that's gone up, of maintaining the car, the cost of fuel of the car."
Summing up, he said, "People unfortunately just look at what they think is affordable on a monthly basis -- at the moment.
"Then when you go into extended term loans, like 72 months or 84 months, most of that loan you're beyond the limits of the factory warranty, so any major repairs that crop up just go beyond what people can handle.
"So people should save up enough for a reasonable down payment. That's not $500 or $1,000, it's 10-percent down, 20-percent down, at least cover your state and federal taxes -- so you can pay for the car over a shorter term rather than a longer term."