Trump sends $500 ACA refunds, but they will not cover an average new car payment

$500 falls below one car payment

The Trump administration started sending $500 Affordable Care Act refunds to eligible HealthCare.gov customers on September 30. Distribution continued into October 2026. Experian reported an average monthly new car payment of $765 during the second quarter of 2026.

The federal refund falls $265 below that benchmark. The ACA refund is paid once. New car borrowers make monthly payments under their loan agreements.

Who can receive the refund

The White House announced the ACA refund program on September 10, 2026. It said nearly one million people across 30 states would receive payments. Eligible recipients generally bought coverage through the federally operated HealthCare.gov marketplace without premium assistance.

The money comes from excess exchange user fees. States operating their own exchanges use different funding arrangements. Those states are outside this federal refund program.

ACA assistance affects eligibility

Eligibility depends on Marketplace coverage and premium assistance. An administration official told CBS News that recipients are primarily people earning above 400% of the federal poverty level.

Some customers below that level can qualify if they paid full premiums without federal assistance. Households can receive multiple payments when several members qualify.

The Treasury Department distributes payments by check or direct deposit. The program targets qualifying federal Marketplace customers.

Federal user fees fund the refunds

CMS set the federally facilitated Marketplace user fee at 2.5% of monthly premiums for the 2026 benefit year. The rate was 1.5% for 2025. Insurers pay these fees for plans sold through the federal platform.

The White House says collections exceeded the amount needed to operate HealthCare.gov. The administration says the excess money is being returned to customers who paid premiums without federal assistance.

Marketplace premiums increased

Enhanced premium tax credits expired at the end of 2025 after Congress did not extend them. The change affected Marketplace insurance costs in 2026.

KFF reported that average monthly premium payments increased from $113 in 2025 to $178 in 2026. That represented a 58% increase. The enhanced credits had expanded federal assistance beginning in 2021. Their expiration restored tighter subsidy eligibility rules.

Marketplace deductibles also rose

KFF calculated an average Marketplace deductible of $3,786 per person for 2026. The 2025 average was $2,759, producing an increase of $1,027. KFF linked much of the increase to consumers shifting toward bronze plans.

Bronze plans accounted for 40% of Marketplace selections in 2026, compared with 30% in 2025. These deductible figures generally cover Marketplace consumers. They provide additional context for insurance costs during the refund year.

Most new car buyers use financing

Experian reported that 83.32% of new car buyers used financing during the second quarter of 2026. Financing, therefore, applies to most new vehicle purchases. The average amount borrowed for a new vehicle reached $43,610. That balance was $1,715 higher than one year earlier.

Buyers who finance their vehicles repay those balances over time. The $500 ACA refund represents only a small portion of the average amount borrowed.

Buyers stretch loans across more years

Edmunds reported that 36.5% of financed new-vehicle purchases in the second quarter of 2026 had loan terms of 73 months or longer. A record 23.9% carried terms lasting at least 84 months.

Longer terms spread vehicle debt across additional years of monthly payments. The $500 ACA refund is paid once. Many financed new vehicles carry repayment schedules lasting six years or longer.

Down payments require more cash

Edmunds reported an average new vehicle down payment of $6,206 during the first quarter of 2026. Down payments represent cash provided when buyers finance vehicles.

The average was $6,511 during the first quarter of 2025. Buyers therefore provided less upfront cash on average one year later. A $500 ACA refund remains well below the average cash down payment recorded for financed new vehicles.

Borrowing costs remain important

Experian measured the average new-car loan rate at 6.35% in the second quarter of 2026. The average was 6.79% one year earlier. The average repayment term reached 69.5 months.

Experian also reported an average VantageScore 4.0 credit score of 751 among new car borrowers. Interest rates and repayment periods determine how financing adds to the total cost of a vehicle loan.

Credit changes monthly car payments

Experian reported different new-car payment amounts across borrower credit tiers during the second quarter of 2026. Near-prime borrowers had VantageScore 4.0 scores ranging from 601 to 660.

Their average new-car payment reached $816 per month. Super-prime borrowers with scores from 781 to 850 averaged $741. The $75 difference illustrates how monthly new-car payments can vary across credit groups, even within the same quarter.

Four-figure car payments grow

Edmunds found that 20% of financed new-vehicle purchases had monthly payments of at least $1,000 during the first quarter of 2026. The share was 17.7% during the first quarter of 2025. Four-figure monthly payments, therefore, represented a larger portion of financed purchases.

For borrowers paying at least $1,000 per month, a $500 ACA refund covers less than one full vehicle payment.

Nearly 20% of American car buyers have a monthly loan payment of over $1,000 shows how common four-figure payments have become among financed new-vehicle purchases.

Auto debt can last for years

Edmunds reported an average new-car finance term of 70.3 months in the first quarter of 2026. That average is just under six years, although individual borrowers can have shorter or longer repayment periods.

An auto loan continues according to its contract after the vehicle leaves the dealership. Receiving a one-time $500 ACA refund does not automatically change the principal balance or repayment schedule of an existing auto loan.

Chase CEO warns of rising auto-loan risks as repossessions surge, highlighting the financial pressure already facing borrowers as vehicle debt becomes harder to manage.

Would a $500 ACA refund make much of a difference if it cannot cover an average new-car payment? Share your views in the comments

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This slideshow was made with AI assistance and human editing.