Credit Delinquencies at an All-Time High..What’s Really Going On in the Car Game

By Flame Newton, Board Member, Midwest Dealer Association

Yo, let’s keep it real. The car game right now? It’s wild. Folks out here can’t keep up with their car notes, and I ain’t talkin’ a few I’m talkin’ record-breaking levels of people behind on payments. This ain’t no rumor; the numbers don’t lie.

According to reports, over 6.6% of subprime borrowers that’s people with low credit are at least 60 days late on car payments. That’s the highest in decades. And it’s not just the “bad credit” crowd either. Even folks with decent credit are startin’ to struggle.

So, as somebody who came from the streets, did time, flipped my life, and now sit on the board of the Midwest Dealer Association, I gotta break this down in a way that’s real for you the everyday person who’s tryna get a car, build your credit, or just make sense of how this system really moves.

Let’s Talk About Why People Ain’t Payin’

It ain’t because folks just don’t care. It’s because life is expensive as hell right now. The average car payment for a new whip? Over $725 a month. Used car? Still sittin’ around $500+. That’s before gas, insurance, and maintenance.

See, the system flipped. Cars got more expensive. Interest rates shot up. People stretched out loans to 72, 84, even 96 months that’s 6–8 years for a car that’ll start breakin’ down in 3 or 4.

You got folks tryna juggle rent, groceries, daycare, and then you throw a $700 note on top? Yeah, somethin’s gotta give.

Flame’s Take Credit Is the Real Game

Now let me tell you somethin’ straight: car buying ain’t just about the car it’s about the credit. You can walk on a lot with bad credit, but you gon’ pay three times what the next man pays for the same ride.

Let’s say your boy has a 750 credit score, and you sittin’ on 580. Y’all both want that Dodge Charger. His payment might be $480 a month with 0 down. Yours? $720 a month with $2,000 down.
Same car. Same price tag. Different credit.

That’s why I always tell people: it’s not about what you drive, it’s about what drives your rate.

Auto Credit Scores Different From the Rest

Now here’s somethin’ a lot of people don’t know: your auto credit score ain’t the same as your regular credit score.
You might have a 680 on Experian, but when the dealer runs it, the auto score might be 630 or even 600.

Why?
Because the auto industry uses a specific scoring model it weighs your history with car loans more than credit cards or rent. If you’ve ever had a repo or missed a few notes, it’s gon’ show heavy on that report.

So yeah, you might think your credit is good but your auto credit file might tell a different story.

What Good Credit Looks Like (and Why It Matters)

If you want to walk in a dealership and say “no money down”, here’s what your profile gotta look like:

• 700+ credit score (auto score)

• Less than 30% credit card utilization

• No late payments in 12 months

• 2–3 active accounts showing on-time payments

• No collections or recent repos

When your credit profile is built right, they’ll fight to finance you not the other way around. And when you the one getting called instead of doing the calling? You the expert, not the desperate.

Should You Put Money Down?

Now a lotta folks ask me:
“Flame, should I put money down or just do 0 down?”

Here’s the truth both got benefits.

If you put no money down, you keep your cash for emergencies, but your payments gon’ be higher. If you put a down payment, it lowers your monthly note and the amount of interest you pay over time.

But if you miss payments? That’s where it all comes crashing down.

Miss a few notes and the bank don’t play they’ll repo the car, sell it for less at auction, and still come after you for the difference. That’s called a deficiency balance. And yes, it sticks to your credit like super glue.

Now Let’s Get Real The Questions You Should Be Asking Yourself

Most people never ask the right questions. That’s why they keep getting hit by the same problems.
So I’ma give you 25 questions that people ask me on the regular basis but I need you to think about, Here’s the deal I’ma answer them straight for you. Class is in session.

1. Why are so many people behind on car payments?

Because the cost of living went up but paychecks didn’t. Inflation hit everything gas, food, rent but income stayed the same.

2. Who’s hurting the most?

Subprime borrowers that’s folks with 620 and below. They pay higher rates, and when times get tight, those are the first to fall behind.

3. Why are newer car loans failing faster?

Because they were written with bad math. Too much car, too little down, too long of a term. I know it hurts I get straight to the point.

4. Does borrowing more increase your risk?

Absolutely. The higher your payment, the faster a missed check turns into a missed note.

5. Why are loans getting longer?

Dealers stretch the term so you can “afford” the car but that’s how you end up paying $50K for a $35K ride.

6. Are banks tightening up on credit?

Yes. They raising credit score minimums and cutting back on risky loans.

7. Why are used cars risky?

Because they lose value quicker and break down sooner and lenders know that.

8. What happens if your car gets repossessed?

They auction it cheap and still come after you for what’s left.

9. Should you try to refinance?

If your score improves, yes lower your rate, lower your stress. I love credit unions cause those folks compete for your business.

10. Can you get help before you default?

Yes, most lenders will work with you before they repo it. But don’t wait communicate early.

11. Why do some people get approved easy while others don’t?

It’s all about trust your credit report is your reputation on paper.

12. Is a co-signer worth it?

Only if both of you trust each other. A repo hits both credit reports the same. I tell the co-signer don’t co sign but I do tell the borrower find a co signer. I get it it’s confusing but the real ones get it

13. What’s better.. new or used?

Depends on your credit. With great credit, new gets you better rates. With bad credit, used can get you in cheaper.

14. Should you buy or lease?

Leasing works if you like new cars every 3 years but missing a lease payment hurts like any other loan.

15. How do you protect your credit once you get approved?

Set auto-pay. Never miss a note. Stay under 30% utilization on credit cards.

16. Is debt-to-income ratio important?

Yes, lenders look at how much you owe vs what you make. Keep it under 20%.

17. Why do some people get repo’d after just 3 months?

They bit off more than they could chew.. no budget, no discipline.

18. What’s one thing every buyer should do before walking into a dealership?

Pull your credit report. Know your numbers before they do.

19. Should you get pre-approved from a bank or finance at the lot?

Bank pre-approval gives you leverage the lot can’t play games with rates.

20. What’s the biggest mistake people make when buying a car?

Falling in love with the car before doing the math.

21. What happens if you roll old debt into a new car loan?

You’re paying for two cars while driving one. Don’t ever do it.

22. How does credit age affect auto scores?

Older credit lines show stability it’s like telling the bank, “I’ve been responsible for years.”

23. Should you worry about repos on your record?

Yes. It stays up to 7 years and kills your next approval. Also look up your state laws it could be sooner.

24. Can you rebuild after a repo?

Definitely. Start small get a secured credit card, make on-time payments, build back trust.

25. What’s the main lesson in all this?

Your credit ain’t just about buying things it’s about creating freedom.

Listen, credit is power. It’s the difference between struggling to survive and strategizing to succeed.

In the car game, good credit turns you from a borrower to a boss. It makes lenders chase you. It makes deals smoother. It puts you in control.

So don’t run from your credit learn it, master it, and use it like a tool. I turned my life around understanding this, and I teach it every day.

If you want to tap in, follow me on Facebook, Instagram, Twitter, or LinkedIn all under @FlameNewton.

Because remember this “a man with cash might buy a car, but a man with credit buys the lot. “