Auto loans stretch out to 84 months, giving new reasons for buyers to get new cars. This and other factors have moved the total auto loan poll to $932 billion. The car industry has to grapple with how many of these loans will be paid back, particularly ones with very long payback terms.

According to Experian Automotive, a research firm that tracks industry trends:

[T]he total dollar volume for outstanding automotive loan balances grew by $92 million from the second quarter of 2014 to the second quarter of 2015. It was the largest dollar volume growth since 2006, according to Experian’s latest State of the Automotive Finance Market report. Findings from the report showed that total loan balances also reached a record-high $932 billion in the second quarter of 2015, up from $840 billion in the second quarter of 2014.

In addition to rapid growth and record-setting dollar volumes, the automotive loan market showed increased stability, as consumers continued to make timely payments. In the second quarter of 2015, the 30-day delinquency rate dropped to the lowest level for a Q2 period in the past five years at 2.32 percent, down from 2.37 percent in the second quarter of 2014. The 60-day delinquency rate was up, but only slightly, from 0.603 percent in the second quarter of 2014 to 0.607 percent in the second quarter of 2015.

However, Bloomberg reports:

Demand for automobile debt in the U.S. is enabling lenders to make longer loans to people with spotty credit, stoking concern that car shoppers are being lulled into debt loads they won’t be able to sustain.

Of the subprime vehicle loans bundled into securities, 73 percent now exceed five years, up from 64 percent during the first three months of 2014, according to data from Citigroup Inc. Loans as long as seven years are increasingly being put into more bonds as auto-finance companies and Wall Street banks sell the securities at the fastest pace since 2007.

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An example of the longer term car loans are the 72-month loans from Ford Motor Co.’s (NYSE: F) troubled Lincoln division, which charges a rate of 2.9%. Also, Hyundai offers 72-month loans on its Azera at a 2.99% rate.

The fact that car companies offer these loans at all must be due to troubles moving inventory. That, by itself, is due to a combination of low demand and terms that make defaults more prevalent.

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