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Subprime Demand Drives US Loan Growth to New Heights

Subprime borrowers propelled U.S. unsecured loan balances to a record $276 bn, a 10% increase year‑over‑year, with 26.4 million consumers holding such loans. Credit‑card issuers expanded lending to lower‑income customers, pushing total balances 4% higher to $1.15 trillion, but responded by trimming initial credit limits. Delinquency rates have inched upward as consumers use loans to offset stagnant wages and higher living costs. TransUnion expects slower growth ahead, forecasting a 5.7% rise in new unsecured loans in 2026 alongside modest mortgage and refinancing gains, while auto loans are set to dip 1.5%.