SFA Research Corner: Shifting Gears in a Two-Speed Market: Credit Transmission and Auto ABS Performance
article by Structured Finance Association
Recent SLOOS and TransUnion data point to a two-speed credit market: access remains ample for prime borrowers but continues to tighten for subprime consumers. As of mid-2025, roughly one in five Americans carried a subprime VantageScore—closer to three in ten under FICO’s broader definition—highlighting the widening divide in credit quality. That split is now showing up in auto ABS performance, where prime pools remain stable while subprime collateral faces record delinquencies and selective rating actions.