Rising Auto Loan Rates: Should Buyers and Investors Be Concerned?

Car buyers in the US are being forced to take out car loans with interest rates ranging from 17% to 22%, due to the need for transportation and the country's credit rating system. The high borrowing costs increase the risk of late payments, defaults, and car repossessions. However, investors in the subprime auto sector have not been deterred, with nearly $30 billion of new bond deals already cleared this year. The resilience of the economy, despite the Federal Reserve's efforts to combat inflation, has kept borrowers making their payments and bondholders satisfied.