TEXAS — Everything is bigger in Texas, and apparently so is our automobile debt. According to a study by WalletHub, Texans have the most cities where people are most likely to overspend on cars.
Auto loan debt increased alongside car purchases, increasing by another $10 billion in Q2 2024 to $1.63 trillion, according to the Federal Reserve Bank of New York.
WalletHub’s study compared the median auto-loan balance and income in more than 2,500 U.S. cities to determine where people are spending the most on cars.
Ranking in at No.1 is Rio Grande, Texas, with a debt-to-income ratio of 98%. Residents here have a median auto loan debt of $30,418.
Texas cities hold the rankings on the list as follows:
Rio Grande, TX: $30,418
Donna, TX: $27,091
Mercedes, TX: $24,494
San Juan, TX: $27,625
San Benito, TX: $24,165
Jacksonville, TX: $24,840
Tolleson, AZ: $24,979
Brownsville, TX: $26,084
Willis, TX: $24,956
“Many Americans are overspending on cars; in over 200 cities, the average resident’s auto loan debt is the equivalent of half or more of their yearly income. Residents dealing with these expensive loans on top of debt from credit cards, personal loans, student loans and mortgages are at risk of falling behind on payments and having their vehicles repossessed,” said Cassandra Happe, a WalletHub analyst. “Buying less-expensive, used vehicles or saving up money to minimize loans can help prevent unsustainable auto loan debt.”
For a full list of the cities and where they rank in their car spending, click here.