Posted on 08/04/2022 9:11:56 AM PDT by Signalman
My guess all of the repos will be crushed and recycled rather than dumped back on the market which would cause more defaults. It’s what they may do. I hope I am wrong.
I know several people who bought vehicles they shouldn’t be able to afford
One kid bought a $67K truck
He makes about $35K
I just shook my head knowing what is coming
That's why you invest in individual equities and NOT "the market"!
Then your informed investments are more likely to be GAINS, not losses.
i.e. High Yield energy stocks throw off ~7% even when the stock price is volatile.
(ET, EPD, CEQP Preferred)
Your mileage may vary....
I can afford luxury vehicles as well
I drive 2016 Ford Fusion S
241,000 miles
And it seems to be an inverse phenomena.
Most of the poor folks I know have car payments. And for stupid cars and trucks.
Where I used to work (electronics/security maintenance tech) *all* of the janitors who came in (6-10, a big building) had new, fancy/pimped out cars. I made 2-3X and was driving a 17 year old Dodge colt with 280K miles.
Did you buy your first house with cash?
I agree that that you should not finance a used car but there is nothing inherently wrong with getting a new car loan so long as you maintain a decent debt/income ratio (generally 36% or less). A new car should easily last you 7-10 years so if you get a four or five year loan, you will be in position to have a few years without a car payment in which you can save for your next car.
However, there are smart and dumb ways to finance a new car. I would recommend at least a 30% down-payment, so that you are never upside down on your car. That way, the resale value of your car always exceeds your loan, so you can unload the car and pay down the loan if you ever get yourself in a pinch. Also never go past a five year loan. A four year loan is ideal.
I've used that approach for years. The result is I was able to put over 50% down on my last car and the car payment is just under $400/mo. My company gives me a $700/mo car stipend so I'm actually coming out ahead of the game.
I know some that are paying almost $1,000/mo on their car loan - now that is just crazy. If you are paying that much on a car loan, you definitely cannot afford the car you are driving.
Financially savvy, you are not.
You think the government is going to let that happen?
That’s my philosophy too. And it’s especially true with a money-sucking, depreciating asset like a car. Taking out a loan to buy a vehicle for personal use is one of the dumbest financial choices out there. I’m sorry, if the only functional car out there that you can afford for cash is a 2008 Corolla then that’s what you should be driving.
Little piece of advice. If you think taking a loan to buy a car is one of the dumbest things you can do, you should not be making any financial decisions on your own.
“My guess all of the repos will be crushed and recycled rather than dumped back on the market which would cause more defaults.”
I doubt it.
Well, I’m doing pretty well financially — not quite “the 1 percent” but close to that — so I’m not inclined to take your advice regarding my ability to make financial decisions. Bless your heart.
And she’s still working as a house keeper?
used car lots got lots of it too..
I was selling cars to unemployed people and the banks were writing the notes because they had 25% down..
ya, well... when the government cheese ended.. so did their income.
Yes it does.
could have sold it back to the dealer. it’s worth as much used as it was new.
I sell used cars..
I daily a 06 postal dodge minivan (still left hand drive) that I paid 400 for at auction.
I get it, but every broke buyer that strolls in wants the newest cleanest car on the lot.
I should tell um that is why they are always broke (payment poor) but I just push papers. as long as the bank buys the note. not my problem.
honda has had CVT in some cars since the early 2000s. (hybrid civic) hopefully they have figured out how to make one by now.
Not that many..
many older cars from high risk loans are repo’d because they are junk and no longer function.
I saw somewhere that the average new car sale was like $46K.
Are there really that many people who have that kind of money?
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