Elizabeth Warren Launches Investigation into Rising Auto Repossession Rates

Senator Elizabeth Warren has initiated an investigation into the auto lending industry due to a significant rise in vehicle repossessions, which are at their highest since the Great Recession. The investigation focuses on illegal and erroneous repossessions, where cars are seized despite borrowers being current on payments. Warren has reached out to major auto finance companies for information on their repossession practices, with responses due by February 16. The rising costs of vehicles and high interest rates are contributing to financial distress among borrowers, particularly those with subprime credit histories, leading to a surge in late payments and repossessions, which reached 1.73 million in 2024. Warren emphasizes the devastating impact of losing a vehicle, as it often leads to loss of income.

Key Details: • Responses to Warren's inquiry are due by February 16. • In 2024, 1.73 million vehicles were repossessed, the highest since 2009. • Average transaction price for new vehicles reached $50,000. • Average interest rates for used vehicles were 10.5% in December. • Subprime borrowers are particularly affected by rising repossession rates.