Auto Loan Delinquency Numbers From NY FED Nov 2016

Discussion in 'In the News' started by ALS, Dec 1, 2016.

  1. ALS

    ALS Super Moderator Staff Member

  2. Jay

    Jay Well-Known Member

    All you broke peeps stop taking out loans you can't pay. You better get out of my way when I step up to buy. I'm paying cash money and I don't want you in the way, bidding up the price of my car.
  3. Mendel Leisk

    Mendel Leisk 2010 Prius (CAN Touring) Staff Member

    Canary in the coal mine?

    There was a proliferation of "payday loan" places a few decades back around here, and I guess all over north America. They should be run off, ditto for casinos, lotteries and the rest: just pushing the irrational among us deeper and deeper into the hole.
  4. Blackbelt

    Blackbelt Well-Known Member

    This is not hard. Pay cash for your car. If you cannot pay cash, at least put down 20-30% on your car.
    Hey wait Blackbelt, you elitist jerk, we don't have that kind of money!
    Well guess what? Neither did I. I was making crap money and raising a family with a stay at home Mom. I drove $1000 junkers to work and learned how to wrench them myself to keep them on the road. I bought new inexpensive cars for the family (such as 1983 VW rabbit, 1989 Isuzu Imark, 1995Neon, 2001 PT cruiser). Kids are small so i didn't see the need to purchase huge rolling living rooms to transport them. They survive just fine in my economical family cars, and have grown into intelligent men who use their heads.
    My point is, getting caught up in the "family SUV" insanity will hurt you financially. Buy a cheap car for cash, but pretend you are making a car payment. Save all of those payments in their own account for 3-4 years. Them you can either pay cash or have a big down payments. I just purchased a used 2014 Prius C with 22K for my daily commuter. I paid cash for it. I do not make a lot of money. But i am careful with the money i make.
    xcel, Mendel Leisk, kbergene and 2 others like this.
  5. Prozac

    Prozac Well-Known Member

    I agree with Blackbelt. I do not buy new cars for myself, but am willing to get one for the wife. We put a substantial down payment and she then drives them until the wheels fall off. I, on the other hand, tend to get bored of what I am driving rather quickly. To satisfy my car "curiosity", I buy older cars (like my '01 Audi TT) for cash and then sell them when I am bored, rinse, repeat. I have had a total of 42 cars, but never get upside down.
    xcel and BillLin like this.
  6. xcel

    xcel PZEV, there's nothing like it :) Staff Member

    Hi All:

    Similar sentiments here. Used or if you have the $s, buy new but stay within your means.

    I cannot fathom a car payment in this day and age - at my age anyway? - even if it is 0.0 percent. I have not paid off one of my vehicles the day it left the lot since 1987. A caveat. I had to borrow $5k to get a $2,500 rebate deal off the 13 Prius PHEV back in early 2013 but I paid it off on Day 31 of the loan to satisfy the Toyota Motor Credit requirements for the rebate.

    Why would anyone think they need or can afford a $300, $400, $500, $600 or even $700 new car payment? Save up, buy new, and start saving for the next one. $200/month for the next one 10+ years out places $24k cash on the table. As we have seen, new cars are a pretty damn good deal nowadays. A new 4th Gen Prius Two Eco's are going for $21k +TTL, new Elantra Eco's for just over $16k +TTL, new Sonata Hybrids for just under $19k + TTL, new Prius Prime's for just over $22k +TTL if you qualify for the giveaways, or a new RAM 1500 Tradesman std. cab w/ the EcoDiesel for just over $25k +TTL.

    Never go underwater if you can possibly help it because if you are underwater on your car, it leads to being underwater on your home, CCs, and that never ending SOB of living paycheck to paycheck mindset.

    I hope most here do not have to live under that last statements umbrella as it is a tough life long lesson leading to a mess when you approach retirement years.

    kbergene and BillLin like this.
  7. Pavel4

    Pavel4 Well-Known Member

    Gentlemen, as we all know, psychologists have been working on people's minds for generations to turn them into "consumers". If you realize what been going on and can resist the notion of personal status, you will probably never get into unnecessary debt. Most vehicles I have bought have been 6-8 year old imports (Volvos). I usually sell them at the 10-12 year mark having spent almost no money on repairs - a little on maintenance that I do myself.
    People seem to take the easy way out - no personal effort, no dirt ever under their fingernails, want something new, even flashy but forget that after a few months, a new car doesn't seem that new anymore. I have seen this over and over again with my friends. They bought Audi SUVs, Turbo Minis, Lexus, Jags etc. etc. and wanted something else within the year. Why? They aren't stupid (most of them) but they do not understand themselves.
    If a person has little or no disposable income, he can find a decent old Civic or Corolla for cheap. Of course, this assumes you don't have to have Bluetooth, 'lane departure warning' or the other rubbish that is found in these new vehicles!

    There is very little compelling reason to go heavily into debt over a vehicle. And, in urban areas, instead of chronically defaulting on debt, there's always public transport.
    BillLin likes this.
  8. Blackbelt

    Blackbelt Well-Known Member

    Prozac, you and i could probably swap some interesting stories. My vehicle count has exceeded 100, and quite a few of them i either ended up driving for free or made a few bucks on them. I have slowed down lately, but still like some variety, which is why i currently have 5 vehicles. 4 are paid for and one short term lease.
    Wayne, i too am puzzled by some of the amounts of car payments people i know are paying. My brother just spent $42K on a new RAM 2500, and his payment is over $600 for 6 years! I just cannot envision paying that much for a vehicle.
    I tend to be the 'anti-consumer'. In other words, if the peer group flocks to SUV's, i buy a smart. I always did like to go "against the grain". LOL
    kbergene, Jay and BillLin like this.
  9. vangonebuy

    vangonebuy Well-Known Member

    RISK is an unknown, ignored concept in this country.
    Shiny cars and a monthly payment of an almost affordable payment has been bait for many years in the car industry.

    On the train one morning a fellow rider was bragging his lease payment was only $499. a month for 3 years.
    His 18K in the lease payments total and he owns nothing. Except the scratch and dent fees at the close.
    And, he paid fees, sales tax, and insurance on the car for someone else.
    Could have bought a $5000 car and any repairs of 3 years of $3000.
    And banked the other 10K.
    RISK of default and RISK of long term collections are now apparent to 30 coworkers.
    They were just laid off. I truly wish them all well.

    I did meet someone at a resort bragging about his investment returns in a Used Car lending stock.
    I looked up his stock and indeed it was making returns.
    But most of these companies don't last as long as the debt payments they create.

    The posted John Oliver video was pretty accurate.
    Preying on the desperate or uninformed should be held up to the light.
    Post the names in public of these predators.
    BillLin likes this.
  10. Blackbelt

    Blackbelt Well-Known Member

    Leasing can be a real trap, if you do not do your homework. I wanted a smart in 2012, so i decided to lease one for 3 years. Why? Because my gut said that the values were dropping and would continue, so why not let MB take the hit. I leased a car that sold for 17K. I paid a total of $5004 for those 3 years. For those 3 years i drove a trouble free very economical car and paid zero dollars for repairs. Less that .17/mile. Average gas cost was .065/mile. Insurance cost me .035/mile. Total per mile outlay was .27/mile. Thats cheap driving. There are plenty of morons who are paying $500/mo to rent their overpriced pieces of shit, but there are also plenty of deals to be had where the manufacturer will subsidize their leases to move cars. Do your homework to figure out which is which and reap the benefits.
    TheFordFamily, BillLin and vangonebuy like this.

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