Posted on 06/02/2016 12:05:27 PM PDT by detective
Jamie Dimon is sounding the alarm on auto loans.
"Auto is clearly a little stretched, in my opinion," the JPMorgan Chase (JPM) CEO said Thursday morning, speaking at the Alliance Bernstein Strategic Decisions Conference in New York. "Someone is going to get hurt... we don't do much of that."
But other lenders have.
The average size of new auto loans is rising, as is the average payment size, according to research from Experian released Thursday morning.
In May, the total amount of auto loans cracked the $1 trillion mark for the first time, marking a 10 percent increase. It comes as auto sales have hovered around record highs.
(Excerpt) Read more at msn.com ...
Today both auto loans and student loans are reaching dangerously high levels with the risk of defaults increasing.
You can’t get out of student loans. The day is coming when those who default on student loans will get “SWAT teamed”. Maybe that Lesbian African Art degree will help prepare those who majored in this—cope with the coming reality.
First we get “free” healthcare. Bernie is pushing “free” college for everybody. If you don’t have a car how can you get to the doctor and to school. People have a right to “free” cars. It is time for the billionaires on Wall Street to give a new car to me. /s
I can see why. I need to replace my pickup and I need something to tow a large fifth wheel. It’s pretty difficult to find anything under $50,000. A truck equipped similar to my last one is over $60,000. That means I’ll have to stretch the loan term out to 7 years just to keep the payments under $600 a month. My payments may outlast my truck.
I drive a serviceable but pretty ratty car because I don’t buy anything I can’t pay for with one single payment at the time I buy it. I don’t owe anyone anything and these bubbles don’t crash directly onto my own head.
It has already happened a few years ago in California.
Retail sales of autos completely tanked last month. Government motors 18% plunge look good compared to Ford ( moving to Mexico). We have reached the gag point in these insane prices. If you are a young couple starting out ,you have lost your mind if you pay these insanely high prices choked full of needless government regulations and paying for huge health care costs and retirements. Simply don’t do it.
It wasn’t that long ago that the amount financed today for a car...would’ve bought a house.
And yes, I see more and more commercials for 0% for 60 or 72 months.
My cousin’s son was a repo man for some years. He had the most amazing truck. I rode with him on a scouting expedition once. We didn’t pick up anything but he confirmed a couple of locations and noted one vehicle that had been fortified, as he called it, and wrote down the accessory equipment he needed to bring when he came back to get it.
Since I tend to not buy things I can’t afford, I don’t get to benefit from the federal bail out programs.
That being said, car sales should collapse if and when the Fed lets interest rates return to their natural level.
Yeah, I just bought a truck that cost more than my parents paid for the home I grew up in. They bought the house 50 years ago.
“And yes, I see more and more commercials for 0% for 60 or 72 months.”
Been going on for 5 years. Why the auto sales have kept climbing too!
It is the same crew of shadow banking Wall Street firms that were behind the worst of the subprime loans during the bubble.
Now they do payday loans and lend against autos. They heavily advertise on am radio and have tacky storefront offices in strip malls. You’d never suspect that these are part of major Wall Street firms but they are.
This is on the order of legalized usury, the rates can be like 300%. The only thing missing is that they don’t break your legs.
Cars are the reason why many, MANY people are poor.
But they never consider it because they value their image.
7+ year loans Going to get very ugly.
I told my wife, now that she is not working, if one of our (paid for) cars dies I am getting a good commuter bike. Not signing up for a loan that lasts into my 70s for a car that is ridiculously over featured. I seriously like the Suzuki Boulevard 650 thumper. Tank like reliability, belt drive for right at $5k.
Pickups are an example of the drawbacks of even necessary tariffs. There’s still a 25% tariff on imported trucks (NAFTA excepted). Less competition means higher prices.
Owe-Bama's "Cash for Clunkers" took a lot of affordable cars out of the market for working poor, and cost taxpayers $45,000 for each $4,500 distributed. What a shit deal for taxpayers.
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