Although auto prepayment speeds are not as interest-rate sensitive as home mortgages, they are still an issue. Segments of certain auto pools will prepay faster than others, based on the issuer (subprime versus prime) and characteristics of the pools. For example, high APR loans will generally prepay at a faster rate than those with lower APRs.

With all else remaining equal, auto loan rates for new and used cars have moved in line with interest rates, albeit trending at a higher level. In August 2000 when interest rates were at 6.5%, new auto loan rates exceeded 7.0%.

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