📉Delinquencies and charge-offs on auto loans are on the rise, indicating a risky market.
💸Carvana has started selling off its loan portfolio to investors.
📈Wholesale used car prices are increasing, creating a bubble in the market.
🌊The bubble is expected to burst in the summer, leading to a decline in used car prices.
📆The decline in prices is anticipated to occur around July.
Why are delinquencies and charge-offs increasing on auto loans?
—Delinquencies and charge-offs are rising due to risky lending practices and economic factors such as weaker used car prices and tighter lending guidelines.
What is Carvana selling off to investors?
—Carvana is selling off its loan portfolio, which includes the auto loans it has provided to customers.
Why are wholesale used car prices increasing?
—Wholesale used car prices are increasing due to high demand and limited supply of quality used cars.
When is the bubble in the used car market expected to burst?
—The bubble in the used car market is anticipated to burst in the summer, around July.
What can be expected after the bubble bursts?
—After the bubble bursts, used car prices are expected to decline as the market corrects itself.
00:00Delinquencies and charge-offs on auto loans are increasing, indicating a risky market.
03:12Carvana has started selling off its loan portfolio to investors.
06:42Wholesale used car prices are increasing, creating a bubble in the market.
09:34The bubble is expected to burst in the summer, leading to a decline in used car prices.
