Average amounts financed, monthly payments and repayment terms all grew on a year-over-year basis in the first quarter, Edmunds analysts report, putting auto finance on shaky ground.

Americans borrowed an average of $43,899 to finance the purchase of a new vehicle in Q1, up more than $3,000 from Q1 2025. The average monthly payment increased by $32 to $773.

Adding to the industry’s concerns are an average down payment that fell by more than $300 from Q1 2025 and 84-month terms, which hit a record share of nearly 23% of all financed new vehicle purchases, up from 21.2% a year ago. One bright spot was interest rates; the average APR fell from 7.1% in Q1 2025 to 6.9% in Q1 2026.

“Right now, consumers are picking their battles when it comes to affordability,” writes Edmunds’s director of insights, Ivan Drury, in a release. “While a larger down payment is typically the better financial move, many buyers simply don’t have that flexibility in today’s market, especially if it means diverting funds away from more immediate needs. In those cases, extending the loan term can help achieve a similar monthly payment, but it often comes with higher long-term costs and added financial risk.”

Read the full report at Edmunds