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Auto Lending Opens Up in March

Lenders loosened access for subprime borrowers, and consumers with negative equity reached a record high, Cox Automotive reported.

April 13, 2026
Line graphic showing Cox Automotive's March Credit Availability Index status
Credit:

Cox Automotive

2 min to read


Automotive lenders, led by banks, doubled down on riskier borrowers in March, according to Cox Automotive data.

The subprime share of auto loans jumped 200 basis points over February to about 20%, its highest share since March 2020 as the pandemic crisis got under way, Cox reported.

A 30 basis-point yield spread expansion signaled “less favorable” consumer pricing “and may reflect lenders charging a premium to offset the increased risk from higher subprime lending and elevated negative equity,” Cox said.

Borrowers with negative equity rose 120 basis points month-over-month to 59%, up 620 basis points year-over-year and a historical high for the third straight month, Cox said.

Meanwhile, the average down payment percentage was up 30 basis points to about 14%, though that’s down 80 basis points year-over-year.

Overall auto loan approval rates climbed 40 basis points to about 71%, ending a two-month streak of declines, Cox reported, though that’s down from 73% a year earlier.

Credit was more accessible in all sales channels, though the noncaptive segment led the way, and banks created the most availability, up 5% month-over-month, Cox said.

“With negative equity reaching a new all-time high, lenders increasing exposure in this environment face growing collateral risk, and balancing volume growth with disciplined underwriting will be increasingly important as these risk indicators continue to build,” wrote Jonathan Gregory, senior director, economic and industry insights.

DIG DEEPER: Auto Loan Forecast Bucks Market Trend


 

 

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