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Could subprime auto loans lead to same economic catastrophe as risky mortgages?

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More buyers who borrow to purchase used cars may find themselves overextended with a loan that stretches well beyond their fast-depreciating vehicles’ best years, industry watchers have warned.

These concerns, and a run-up in sales, have placed a lot of attention on the auto-loan market this year. The word “bubble’ has been floated. Could some borrowers get hurt in deteriorating conditions? Yes. Lenders, too. In fact, J.P. Morgan Chase JPM, +0.41% CEO Jamie Dimon has addressed auto-loan risk at least two times in as many months, and as recently as last month he called the market “a little stretched.

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