The number of vehicle repossessions has gone up drastically this year, which is about to top 1.9 million, which is a significant jump of 15% since 2007.  Chances are that a large number of those vehicles were large SUVs and trucks or luxury cars that mortgage brokers purchased when they thought the good times would keep on rolling forever.

Now that the housing bubble has popped, the large monthly payments and gas costs are practically unaffordable.  People are opting for used cars with used car warranties and staying away from new cars.  Unlike many other lenders, carmakers can’t really be blamed for giving out loans that are risky.  Borrowers who have great credit scores are having their Mercedes’ yanked away, just like the people who got Honda Civics.

This is terrible news for carmakers, as if they haven’t had enough, because for a repossessed car the average loss is around $10,000.  Then the repos that have been heavily discounted end up on dealership lots and give the small amount of car shoppers out there a good reason to buy a discounted repo with the addition of roadside assistance, instead of a new car.