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$45k loan for a $27k car! #5262958 11/10/19 12:36 AM
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Mad_Hatter Offline OP
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This is bonkers..In one example 2 young ppl rolled in nearly $15k in negative equity! And it's said that dealerships often make more off originating the loan than from the sale of the vehicle itself. This is gonna be bad bad bad for the economy because at some point the piper has to be paid.😉

Link to WSJ article

[Linked Image]

Last edited by Mad_Hatter; 11/10/19 12:37 AM.
Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262962 11/10/19 12:55 AM
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WhyMe Offline
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whats one of the things a car salesman ask you? " how much a monthly payment can you afford" ? some people just don't care how much the car cost as long as they can make the monthly payment.

Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262965 11/10/19 01:15 AM
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csandste Online Content
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I pay cash. I get 'em from Hertz. The next recession/depression will be caused by idiot people and idiot companies taking on debt.


2017 Kia Soul Plus-- VWB 5w30 (+ Harvest King Syn) 68,500 miles
Re: $45k loan for a $27k car! [Re: csandste] #5262969 11/10/19 01:49 AM
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Mad_Hatter Offline OP
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Originally Posted by csandste
I pay cash. I get 'em from Hertz. The next recession/depression will be caused by idiot people and idiot companies taking on debt.

That was certainly one of the causes of the last recession. Unscrupulous lenders putting people in homes they simply could not afford. The same is being done with these car loans...6, 7, 8yr loans and $600, $700, $800 payments (or more) for run of the mill vehicles are now common place. Yet discretionary income hasn't risen but a few points over the last decade or two. I haven't had a car payment in over 6yrs now and love it. Neither do I owe anybody anything in the form of unsecured debt.. and I sleep well at night as a result.😉

Last edited by Mad_Hatter; 11/10/19 01:51 AM.
Re: $45k loan for a $27k car! [Re: WhyMe] #5262970 11/10/19 01:55 AM
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Mad_Hatter Offline OP
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Originally Posted by WhyMe
whats one of the things a car salesman ask you? " how much a monthly payment can you afford" ? some people just don't care how much the car cost as long as they can make the monthly payment.

$15k in negative equity on top of principle is insane..one is better off just getting it over with and declaring bankruptcy, as I'm sure that's the inevitable fate awaiting that consumer anyhow.. that is unless something dramatic happens like winning the lottery or getting a promotion to CEO.😂

Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262971 11/10/19 01:58 AM
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Mad_Hatter Offline OP
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Huh, i didn't mean to post this in the "Humor" subsection (nothing funny about it).

Can a mod move it to the "General" sub-forum?

Last edited by Mad_Hatter; 11/10/19 02:00 AM.
Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262972 11/10/19 02:07 AM
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SirTanon Offline
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One of many reasons I buy my cars at least 4 or 5 years old, as a rule.. or more. Less than 1/2 the price, and still last me 5 years.


2013 Nissan Altima SV - 2.5 liter/CVT - 123,000mi
2014 Nissan Altima SL - 2.5 liter/CVT - 69,000mi
2010 Ford Fusion - 274k mi - SOLD
Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262978 11/10/19 02:31 AM
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Wolf359 Offline
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Originally Posted by Mad_Hatter
Originally Posted by csandste
I pay cash. I get 'em from Hertz. The next recession/depression will be caused by idiot people and idiot companies taking on debt.

That was certainly one of the causes of the last recession. Unscrupulous lenders putting people in homes they simply could not afford. The same is being done with these car loans...6, 7, 8yr loans and $600, $700, $800 payments (or more) for run of the mill vehicles are now common place. Yet discretionary income hasn't risen but a few points over the last decade or two. I haven't had a car payment in over 6yrs now and love it. Neither do I owe anybody anything in the form of unsecured debt.. and I sleep well at night as a result.😉


There's always a certain percentage that will go bankrupt. It's baked into the interest rate. But if there are too many that go bankrupt, then you have an issue. Isolated cases like these are pretty common. The economy keeps humming along, no telling how long people can keep it up.

Re: $45k loan for a $27k car! [Re: Wolf359] #5262979 11/10/19 02:38 AM
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Lolvoguy Offline
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Originally Posted by Wolf359
Isolated cases like these are pretty common. The economy keeps humming along, no telling how long people can keep it up.

+1
No need to stress or get excited. This has all been accounted for.
coffee


06 Lexus IS350- Wife
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Say "no" to Turbo!
Re: $45k loan for a $27k car! [Re: csandste] #5262980 11/10/19 02:40 AM
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billt460 Offline
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Originally Posted by csandste
........The next recession/depression will be caused by idiot people and idiot companies taking on debt.

+100. We saw it a decade ago in the housing market. Apparently few, if any have learned their lessons.

I can't understand how people put themselves into these financial situations. We're talking basic addition and multiplication here. The dumbing down of America continues.

Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262988 11/10/19 03:36 AM
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daves87rs Offline
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It’s about making a profit- and it might even help your 401k....

It’s been a growing market the last few years. You even see companies like Chase getting into the game. As people finally start cutting back due to the crushing blow of credit debt- companies need to find a new way to make money. That will come in the way of much higher rates for all. I’ve already seen a friend with a 750 credit score told the best the dealership could do was 13 percent rate for a new car....

The so called next “money maker” will be the bad credit and “almost rough” credit crowd......


2019 Chevrolet Equinox LS
2006 Chevrolet Cobalt LS
Re: $45k loan for a $27k car! [Re: billt460] #5262989 11/10/19 03:38 AM
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Mad_Hatter Offline OP
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Originally Posted by billt460
Originally Posted by csandste
........The next recession/depression will be caused by idiot people and idiot companies taking on debt.

+100. We saw it a decade ago in the housing market. Apparently few, if any have learned their lessons.

I can't understand how people put themselves into these financial situations. We're talking basic addition and multiplication here. The dumbing down of America continues.

I'm not excusing personal responsibility but I think lenders are also preying on the "low info" consumer and the sub prime credit people. If you can't pay off a car in 5yrs or less, then buy a cheaper car more in line with your income and debt... that is what the finance guy should be telling people but obviously isn't. I've always said when the finance guy is able to do one of these loans where he's rolling thousands of negative equity into the new one...he gets to eat lobster for dinner that night.😉

Last edited by Mad_Hatter; 11/10/19 03:39 AM.
Re: $45k loan for a $27k car! [Re: SirTanon] #5262993 11/10/19 03:43 AM
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Originally Posted by SirTanon
One of many reasons I buy my cars at least 4 or 5 years old, as a rule.. or more. Less than 1/2 the price, and still last me 5 years.

CPO's can be a steal on some models. In many cases you get the/a factory or dealership warranty for several years and someone else took the hit on the new car depreciation. What's the rule of thumb, 10% the second you drive it off the lot?🤔

Re: $45k loan for a $27k car! [Re: Mad_Hatter] #5262995 11/10/19 04:03 AM
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demarpaint Offline
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Years ago I sold 100's of cars to people who were upside down in car loans, and tacked it on to another loan. Most because they had to have the latest and greatest, or trade up. The Finance managers I worked with were experts at it. The term stupid comes to mind, stupid people putting themselves in debt like that, and stupid banks for allowing it. I see nothing has changed. I learned years ago, if I couldn't afford it not to buy it. That has kept me with perfect credit for several decades now.


God Bless Our Troops

Re: $45k loan for a $27k car! [Re: SirTanon] #5262999 11/10/19 04:24 AM
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earlyre Offline
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Originally Posted by SirTanon
One of many reasons I buy my cars at least 4 or 5 years old, as a rule.. or more. Less than 1/2 the price, and still last me 5 years.


my sweet spot is 5yrs old/60kmi/$10k... worked at least twice so far...both cars were over $30k new...

Last edited by earlyre; 11/10/19 04:25 AM.

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