Across the United States, a growing share of drivers now send more money to the dealership each month than to their mortgage lender. What once sounded like an online exaggeration has quietly become a new financial normal, as car payments swell into four-figure territory and stretch over longer and longer terms. The result is a budget squeeze that reaches far beyond the garage, reshaping how households think about debt, housing, and even work.
Behind those eye-popping bills is a mix of record vehicle prices, elevated interest rates, and loan structures that treat cars less like depreciating tools and more like mini-mortgages. For many families, the question is no longer whether a car is affordable, but which other priorities must be sacrificed to keep the keys.
The numbers behind “car-as-mortgage” payments
To understand how car notes are catching up to housing costs, it helps to look at the averages. One widely shared breakdown on social media highlighted that the typical new car payment in the United States had climbed to $750, while the average new mortgage payment was $2,850. That comparison resonated because it captured a simple reality: a single vehicle can now consume a chunk of income that once would have covered an entire modest mortgage for an American family.
More formal data tell a similar story. A detailed look at the average monthly car loan payment shows that new vehicles now carry typical notes of $748, while used cars average $532. At the same time, the median monthly mortgage payment in America has reached $2,034, and new mortgage applicants are facing a national median payment of $2,211. When a household has two vehicles, it is easy for combined auto payments to rival, or even exceed, what they send to their lender for the roof over their heads.
Record prices and longer loans are driving the surge
The shift is not just about interest rates, it starts with the sticker price on the lot. New models have steadily crept into luxury territory, with one recent benchmark showing that the average new car price has pushed past $50,000. In fact, the average American new car buyer recently paid $50,080 for a vehicle, a level that would have sounded like a luxury SUV price tag not long ago.
Those higher prices are not a one-off spike. Reporting on the final month of 2025 described how new car transaction prices hit their highest level yet, part of what one analysis framed as an ongoing saga of Everything feeling Too Expensive. To make those prices palatable, lenders and dealers have leaned on longer terms and creative structures, which keep the monthly number just low enough to close the deal while quietly inflating the total cost.
From 100‑month loans to four‑figure notes
As prices climb, the industry’s answer has been to stretch the calendar. Data from Quick Answer tables on auto loans show how the typical Category of payments for New Cars and Used Cars has risen, with the average Monthly obligation now rivaling what many people once associated with a starter home. To make those payments feel manageable, some lenders are marketing ultra-long terms that would have been unthinkable a decade ago.
One trade group notes that Car Payments Now $750 a Month, and that some buyers are being offered 100-Month terms. Marketing materials invite shoppers to Enter the ultra-long Month Car Loan, a phrase that would not sound out of place in a mortgage office. For borrowers, the trade-off is stark: a slightly lower monthly bill in exchange for nearly a decade of payments on a rapidly depreciating asset.
When the car bill beats the mortgage
As these trends collide, the once-rare experience of a car payment topping the mortgage is becoming less unusual. The median mortgage payment in America at $2,034 still dwarfs a single average car note, but many households are not dealing with just one vehicle. Two newer cars, each with payments around $750 or more, can easily surpass the mortgage, especially in regions where homeowners locked in lower housing costs years ago.
At the same time, new buyers entering the housing market are facing their own sticker shock. Guidance on What the average mortgage payment looks like notes that typical monthly housing costs in the United States now sit in the low two-thousand-dollar range before taxes and insurance. For those who bought homes when rates were lower, that makes the car payment feel even more out of proportion, especially when a single SUV or pickup rivals what they pay for an entire house.
Debt stacking and the rise in delinquencies
The strain is not limited to auto loans. A broader review of household finances shows that Balances and Monthly in Tandem, and that As Experian has documented, average monthly obligations on everything from credit cards to mortgages have climbed by hundreds of dollars. When a household is juggling rising card balances, a bigger mortgage, and a hefty car note, there is less room for error if income dips or an unexpected bill hits.
That fragility is showing up in missed payments. Analysts tracking auto loans report that delinquencies are rising across the board, with economist Bandebo noting that the increase in delinquencies has been consistent for low income, middle income, and higher income borrowers alike. Another report describes how Record car prices and high rates have left borrowers with room for error, especially as layoffs and other inflation pressures bite.
More from Wilder Media Group: