Auto Loan Debt Skyrockets: 8 Texas Cities Among the Nation’s Worst
For those that live in Texas, most of the cities are not walkable cities, so therefore most people have to have at least one vehicle in their household to get back and forth to work, school, etc.
The average car loan in the United States lasts 72 months, which amounts to 6 years of monthly payments. According to Experian, the average monthly car payment in 2023 was $726, which currently stands at $644 in 2024.
When people buy a car, they tend to go with the prettiest, fanciest, and expensive. Expensive varies to different budgets. It is an investment, and they will drive this car for the next 7-10 years or more. People will go into debt for their cars or trucks.
Texas has the Most Auto Loan Debt
It's shocking to see that Texas tops this list, especially since California has more registered vehicles than Texas. Unfortunately, 8 out of the top 10 cities for auto loan debt are in Texas.
According to a study conducted by Wallet Hub, the top city in the US with the most auto loan debt is Rio Grande, Texas.
Rio Grande residents overspend on their car purchases. The median auto loan debt is $30,418, while the income is only $31,186. Donna, Texas came in at #2 where the auto loan debt was $27, 091 and the income was $31, 240. Mercedes landed at #3, with auto loan debt at $24,292, and income at $31, 811.
Yahoo Finance found that Texas has the highest car loan balance of $7,810. Most of the time, having a car in Texas is necessary. When it comes to buying a car, it's best to avoid getting into debt. Sometimes, buying a slightly used car is a smarter choice than going for a brand new, fully loaded one. You could also consider sticking with your current vehicle instead of upgrading unless unforeseen circumstances arise. Auto loan debt is often caused by higher prices due to shortages and higher interest rates, as well as by the desire to keep up with others.
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