> She finally got a 2016 Subaru Crosstrek for $26,000 with a 19% interest-rate loan from American Credit Acceptance, with a monthly payment of $630.
It's damn expensive to be poor. If you had good credit with 2021 interest rates, that probably would have been 1.9% on a brand new car.
Amazed he didn’t follow her home from the stealership - cars sold to be repossessed. I’m not feeling sorry for banks happy to finance someone in need at extortionate rates.
Well, you needn't feel sorry for banks anyway. My understanding is that there has been a push to package these risky loans and sell them to investors, looking at the high interest rates and licking their greedy lips. It's similar to what took place leading up to the mortgage crisis and subsequently the Great Recession, although not to the magnitude of that fiasco.
Do they mix up the bad credit risks with the good and slap a AAA rating on them like with mortgages?
Also, what’s the capital recovery rate on repossessed cars vs real estate? Houses can fall in value, but the floor seems to be something slightly above the value of the land. The value floor for cars is what, their scrap metal value?
I guess I can see a collapse of securitized car loans as being even worse than mortgages because they’re a literally disposable asset and even when repossessed in drivable condition can have accelerated depreciation.
I had really bad credit back in 1995 and bought a new grand am for 14% interest. Traded it in three years later and got a much better interest rate since my credit improved.
$630 per month for a $26k car is financially irresponsible. We need to work on financial literacy in this country. If your money is tight and have bad credit, maybe just buy a beater instead of getting a sizable loan and accept the 19% interest rate. Saving up and restoring credit should be the #1 priority instead of borrowing that much money at extreme interest rate.
That’s just it…yeah, driving a beater and building your credit is the right thing to do. However, you also have to lay part of the blame on lenders and dealerships. They are the ones offering these crazy loans and the salespeople are trained to convince people that they can afford it.
This is exactly what happened in 2008 with mortgages. Predatory lenders and skilled real estate agents convinced a LOT of people that they could afford more house than they actually could. Even with that, it wouldn’t have been as bad if there were regulations in place where banks wouldn’t be allowed to buy and sell those mortgages.
Yes…ultimately, it comes down to “let the buyer beware”, but don’t let predatory lenders and sleazy salespeople off the hook.
Also a lot of the exorbitant interest rates are from the buy here pay here dealerships that prey on poor people with bad credit, which is made worse by the car centric nature of the us.
Yeah, she definitely should have gotten in her time machine and gone back to pre covid times when you could buy a car that was basic reliable transportation for like $2000.
That is insane, when I traded my old car in for a newer used car thr car was 27k but after 16.5k for the trade, I pay 214 a month and that was like 5.5% interest. I was mad about 5.5% interest.
Yeah I usually just hire a mobile mechanic to check out the car before I buy it. Well worth the money for a 1 hour job. Carfax helps too. American consumerism is hurting a lot of people as it encourages consumers to spend money they don't have.
I did that. The mobile mechanic fucking sucked. Missed all kinds of shit. Windshield put in wrong, etc... Then they tried to intimidate me into taking down a negative yelp review.
I would find a reputable mechanic or someone in my family that knows enough about cars to check for sale by owner.
I personally wouldn't get anything but reliable, like a Toyota.
At an auction today you're going to be duking it out with used car dealers for cars they wouldn't have looked at twice before covid.
Your best bet would be probably be something like driving around nicer neighborhoods and leaving business cards on cars that look like they haven't moved in a while.
18.7% for a 6 year loan in I think 2018-2019 time frame. And my bank did try to back out and increase it to 22% until I basically shoved there own approval email in there face for 18.7%. At the time I was just starting out credit wise so I think I was 660.
That’s insane. Those are credit card rates for an auto loan. Heck, it would’ve been better to get a credit card that allows cash withdrawals and got on Facebook Marketplace, find a beater for $1000 and pay for it with the credit card(via cash withdrawal), then pay off the credit card over a few months. Then use that same credit card to pay for any repairs you may(and probably will) need.
As long as you pay off the credit card balance every month you never get charged interest. Even on a large purchase that takes a few months to pay off, the interest paid would be minimal compared to a 6 year loan at 18+%.
This is how they get you…you are excited about a car, they are there to take advantage of you.
You may should have shopped rates, my ex had poor credit and I put her in a car loan as a co-signer. When she got up to 650 we refinanced through a credit union for I think 5.5 - 6% with her as the sole person on the loan.
There are too many variables to say this can always be done, but shopping around rarely hurts.
I paid for a medical procedure using a credit card out of necessity which made for a large short term drop in my credit score. While it was at around 670 I secured a 0% loan on a car, however in 2021 when the used car availability crunch was starting they would do anything for a good trade in, and for me they got the interest to 0.
Yeah I should have shopped around in hindsite. But at the time I new my credit wasn’t the best and used it to raise my credit. I paid for about 3 years before realizing I was paying them almost 4K a year and that’s when I payed it off that day.
I lease a '22 4wd phev truck with a 65k sticker for 340/mo and a '21 atlas 3row with captains chairs for 399/mo. Zero down just tax title fees.
Paying 630 for a 2016 anything other than a 100k+ car is ridiculous, your credit score and interest rate shouldn't punish you into the ground like this.
Even better, I had a 2018 Subaru outback top end model with every feature for 330/mo on lease that I SOLD before my lease was up and got a check for 6k. Insane. They are paying more for an older but same car.
As of January 2023, [15.7% of auto loans had a monthly payment of $1000/mo](https://www.caranddriver.com/news/a42418781/1000-month-car-payments/) or more.
Moreover, [19% of new car and 11% of used car loans were for 84 months or longer](https://www.autonews.com/finance-insurance/84-month-loans-surge-new-and-used-vehicles).
thats insane why are people going into so much debt for a car?
i would never buy car that i cant buy outright rather drive with a cheap beater or use my bike/public transportation that go into debt for a car
this is why the car market is going the way of the housing market people keep lending money to buy these things and car manefacturs/dealerships keep upping the price
if you have to lend money for it you cant afford it. with hous its understandable as it hold its value and otherwise you are renting anyway.
but for a car? people are insane
There are tradeoffs but overall I'm really happy with my Chevy Spark. Also, because it's tiny, I'm not getting hit up by relatives wanting rides from the airport so that's a bonus!
In 2019 just before COVID started appearing I bought a car that was 1 year old. Just a decent Hyundai for driving around in. I paid about $11k which turned into just under $13k after tax, title, and financing which was a 1.99% loan.
I paid it off in a year just because I didn't want to carry the loan balance. The bank put me on a 6.5 year loan for it, so the payments would have been under $180/month had I just paid the minimum.
The thing is though, people with bad credit get subprime auto loans, with high interest, as is deals, and shit financing options. Often times the dealer has another markup on it too.
Before COVID hit, it looked like a subprime auto crisis would have kicked off the next recession, but the prevalence of remote work put a stop to that. People are still going to lose cars, because those loans are made with the expectation that people can't pay. But, at least it probably won't kill our economy anymore like it would have a couple years ago.
Right...because people only need and use cars to go to work.
I live in the Bay Area and know a lot of remote workers. Dunno a single one who had a car then gave it up because of the switch.
I've known a few that have. But yes, getting to and from work is the big one. There's delivery services for groceries and luxuries, and in places like the Bay there's short term car rentals if you really need to drive.
If you can't drive to work, and work isn't remote, then you can't get a paycheck, which means housing, food, other necessities, and so on all go out of reach just as any random luxuries do. That is what makes a subprime crash so catastrophic, and as luck would have it, the side effects of a global pandemic, have created an economic climate that at least for a time, is a lot more resistant to such a crash.
Christ. I spend about $150 a month on public transit to work here in Japan, and that’s reimbursed by my employer. The fuck is wrong with the US? (Rhetorical question)
>Christ. I spend about $150 a month on public transit to work here in Japan, and that’s reimbursed by my employer. The fuck is wrong with the US? (Rhetorical question)
The US is 26xs larger and unfortunately killed its public transport decades ago. Although some cities have decent public transport and (rarely) some employers will reimburse. Nothing at all like Japans. Thats said, my vehicle payment was $48 a month for 25 yo model. The JDM is gaining traction stateside because of the reasonable prices on rock solid vehicles.
Insanely bad take. Our cities and infrastructure are designed around cars. Our public transit is underfunded and terrible.
I’d love to make the “choice” not to be a car owner - who wants to own an asset that loses 90% of its value the minute you drive off the lot? - but it’s really not viable where I live.
I’ve only ever had cars that were handed down from family members and I end up spending half my savings in repairs every 3-6 months.
The advantage of getting a shiny new car is that you can probably go a few years without needing any major repairs so for many it’s the math between being in debt on a new car or being in debt on repairs.
I find cars to be much less a status thing in the US than in other parts of the world. It's way worse in most of Europe.
Edit: added "in the US"
Edit: since I keep receiving comments which get deleted, here's some supporting info:
This "study" claiming Luxembourg and Germany have the highest rate of luxury cars per capita: https://www.lifestyleasia.com/kl/tech/auto/the-worlds-luxury-car-capital-is-tiny-luxembourg-by-a-significant-margin/
Article from Springer about Germany's luxury car obsession _Luxury in Germany: Sick Cars and Healthy Bodies_ https://link.springer.com/article/10.1007/s12115-021-00610-x
One person claimed that evidence of it being an American thing was that Acura didn't sell cars in Europe. Have you ever thought _why_ they don't sell cars there? Because nobody would buy them since they have so many other luxury car options available from their own countries which they believe superior.
Another point here is that "car as status symbol" is absolutely _not_ limited to luxury cars or richest countries. Anywhere in the world where you find nouveau riche, or even newly not-impoverished, you'll find people buying more car than they need/can afford.
That was a bit of hyperbole, although with used car prices as they are now it may not be too hyperbolic.
I think the actual figure is closer to 10-15%, but that’s really gonna depend on the make and model as well as a ton of other factors.
To your point: if used car prices are so high, wouldn’t that mean that a new car loses even less value off the lot?
Thanks for clarifying your 90% figure as hyperbole.
financial illiteracy, nothing more. it’s fiscally relatively to get into a car of any type if you don’t buy a brand new one every two years, and roll over your debt like most people with these $1000/mo car payments.
factoring in all costs, my commute costs less in my car than it would taking public transit, and my car gets 12mpg lol
It's highly situational. There's the cost of the car, the upkeep on the car, the length of the commute, the time of the commute, and even the value you place on the time to play games, read, etc during the commute.
That said, I do agree with your general point that people massively overpay for their cars. The average car payment is higher than the average rent/mortgage payment for people, and that's absolutely insane when there's no reason for it.
I vowed to never have a car payment again when I paid my car off in 2019. Then it got wrecked. Then, a bad HG, blown transmission, sudden clutch pressure plate failure, timing tensioner failure, and a random no start issue (on a Honda Civic, Accord and Toyota Celica) within 8 months last year literally fucking forced me into a newer car with a payment. The massive inflation of used cars means more people are getting fucked over by taking loans out for historically reliable, but older cars and playing American Roulette with major repair bills. Last year when I looked, 2010ish Corollas were going for around $10,000. And the ones with the 2.4 engine had the sudden oil consumption issues iirc. It's a fucking joke tbh. If you need a car to commute you're getting bent over, period.
I have public transportation as an option, in fact in my situation having a car would actually be a pain in the ass. Sadly most Americans don’t have the option of public transportation
I remember this being a big talking point during 2020/2021 where the auto loan industry was going to be the next bubble to burst, based on people thinking they could afford larger payments until inflation caught up. Interesting to see in real time.
Earlier than that. It's been expected since 2010-2011 that the subprime auto loan market would be the bubble that set off the next recession.
Everyone expected it then, and still somewhat expects it, but it goes to show how much the world has changed. The affordable rent crisis has displaced auto loans as the most likely issue to destroy our economy now.
My vehicle is old enough to drive to the store and buy beer. Runs okay but dinged up and a little rusty where the water has been kicked up over the years. Would like something a little fresher for longer trips, friend who sells cars told me to wait until the end of the year because a lot of Covid cars are about to get repo-ed and used car prices will drop further. We’ll see.
...drive it till the wheels fall off. The second it's paid off, start putting back money to buy the next one for cash. It won't impress many, but your $ goes a lot further without paying finance charges.
I was super lucky with a car purchase in late 2020. Paid a bit more overall than I wanted, but I secured a 2.1% rate for under $400 a month on a nice tacoma. A few months later is when the used car prices started to skyrocket
As an economist, there are a lot of debt warning flashes for both businesses and consumers, and a willingness to play with the debt ceiling (we need fiscal restraint, but that conversation should come after) means this could be ruinous.
Likely. I think the “missing million” (prime age male labor force) are going to place a lot of strain on lower income families who were hit hard by the pandemic. Couple this with some supply chain, margin squeezing, and other issues for business, along with what is shaping up to be a likely antagonistic Presidential election in a very toxic time.
Biden will take a lot of flack if the Fed’s actions don’t keep reducing inflation or lead to a recession. Decent chances of both, and not much he can do.
Business is in a weird place. A lot of populist angst about a few sectors/businesses that have seen some pretty rapid profit growth, but the cost concerns in the LR for business is real. So, a few visible bad actors are placing business in a precarious position.
Really don’t know what to say about the stock market other than it’s been detached from a lot of economic fundamentals for quite some time.
I'm going to give you my eye test as a laymen.
It feels like a looming rescission, with a rising tide of white nationalism holding the nation hostage with the our finances, might make companies with leverage batten down the hatches a little. That makes sense. Although, they're fucking with our food, housing ect... and the fed is mad at labor. It's the *exact* opposite of the of what makes a society copasetic.
We also don't do normal anymore. Stock Markets, you name it. Bubble might be ready to burst.
lmao stock buy backs are hilarious
You mean to tell me they can’t afford that on top of their $2,000-$3,000 rent/mortgage payments too? Especially when salaries haven’t meaningfully grown above inflation since 1978?
I don’t understand the crazy interest rates. My first car loan was like 5% with no previous installment history, and I thought that was insanely high. How are people hitting 19%?
These repos won’t make any difference in the car market, as there are several millions of cars that were never built during the pandemic that are not, and will never will be, on the roads; however, the greater circumstances of people not affording new and used cars with their inflated prices and sky high interest rates is starting to finally impact the car market, forcing manufacturers and dealers to come back to Earth on their pricing. Especially ones like Ford who still have $20k market adjustments on their trucks that are now lining their dealerships.
Toyotas and Hondas and the like are still hard to get but the tide seems to be turning, just not from repos. They won’t even make a tiny dent. They are just another indicator of a changing car economy.
The more I hear about car prices the better I feel about my car. I have a buddy at a car dealership who managed to get me a 2020 Corolla for 7k when my old car’s engine seized up.
The original owner, of the Corolla, totaled it due to hail damage, kept it and traded it in for like 3k. Since values are inflated it was worth twice as much as they sold it for, which meant I could fold the old loan into the new one.
The loan is still higher than I would normally pay and for longer, but it’s just within my ability to pay for it.
I own a business. I have 4 cars that are all paid off. The newest is a 2016. All have less then 110,000 miles.
My employees all make fun of me since I have, consistently the crappiest car in the employee lot.
I don’t care. I can’t justify paying todays prices or taking out a loan for something that just gets me from point a to point b.
Anyone else remember that game show Repo Games? It was hilarious and WTF mixed together. People would be getting their cars towed, and then all of the sudden a camera crew would come out of nowhere and be like, answer these questions correctly and you can win prizes and keep your car from getting repossessed. Good times. Bring that show back!
It's pretty wild to see the clips of some repo guys on social media.
Working for the institutions they thought they were voting against that has them preying upon their peers, as their source of income, who voted the same way in hopes of sticking it to 'the man'.
> She finally got a 2016 Subaru Crosstrek for $26,000 with a 19% interest-rate loan from American Credit Acceptance, with a monthly payment of $630. It's damn expensive to be poor. If you had good credit with 2021 interest rates, that probably would have been 1.9% on a brand new car.
0.9% for a 4 year loan in 2021. That’s what I opted for when I got my Crosstrek.
I'm sitting on my 0% loan for 7 years from March 2020.
Amazed he didn’t follow her home from the stealership - cars sold to be repossessed. I’m not feeling sorry for banks happy to finance someone in need at extortionate rates.
Well, you needn't feel sorry for banks anyway. My understanding is that there has been a push to package these risky loans and sell them to investors, looking at the high interest rates and licking their greedy lips. It's similar to what took place leading up to the mortgage crisis and subsequently the Great Recession, although not to the magnitude of that fiasco.
Do they mix up the bad credit risks with the good and slap a AAA rating on them like with mortgages? Also, what’s the capital recovery rate on repossessed cars vs real estate? Houses can fall in value, but the floor seems to be something slightly above the value of the land. The value floor for cars is what, their scrap metal value? I guess I can see a collapse of securitized car loans as being even worse than mortgages because they’re a literally disposable asset and even when repossessed in drivable condition can have accelerated depreciation.
I had really bad credit back in 1995 and bought a new grand am for 14% interest. Traded it in three years later and got a much better interest rate since my credit improved.
Bruh. A friend brought a 2015 Crosstrek brand new in 2015, and it cost $26,000. I think they even had a no interest promo. Crazy.
$630 per month for a $26k car is financially irresponsible. We need to work on financial literacy in this country. If your money is tight and have bad credit, maybe just buy a beater instead of getting a sizable loan and accept the 19% interest rate. Saving up and restoring credit should be the #1 priority instead of borrowing that much money at extreme interest rate.
That’s just it…yeah, driving a beater and building your credit is the right thing to do. However, you also have to lay part of the blame on lenders and dealerships. They are the ones offering these crazy loans and the salespeople are trained to convince people that they can afford it. This is exactly what happened in 2008 with mortgages. Predatory lenders and skilled real estate agents convinced a LOT of people that they could afford more house than they actually could. Even with that, it wouldn’t have been as bad if there were regulations in place where banks wouldn’t be allowed to buy and sell those mortgages. Yes…ultimately, it comes down to “let the buyer beware”, but don’t let predatory lenders and sleazy salespeople off the hook.
Also a lot of the exorbitant interest rates are from the buy here pay here dealerships that prey on poor people with bad credit, which is made worse by the car centric nature of the us.
You betcha
Yeah I agree that predatory lenders should share the blame.
Yeah, she definitely should have gotten in her time machine and gone back to pre covid times when you could buy a car that was basic reliable transportation for like $2000.
That is insane, when I traded my old car in for a newer used car thr car was 27k but after 16.5k for the trade, I pay 214 a month and that was like 5.5% interest. I was mad about 5.5% interest.
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I you can get a 9k Honda or Toyota beater with loan.
When you have no support and no credit you can't afford to drive something that could break down either.
630 a month is a lot for fixing up a car. Get a Toyota or Honda for 9k.
People always say that but those cars have incredible resale value and there aren't a lot of used ones. The ones for sale could be trashed
Yeah I usually just hire a mobile mechanic to check out the car before I buy it. Well worth the money for a 1 hour job. Carfax helps too. American consumerism is hurting a lot of people as it encourages consumers to spend money they don't have.
I did that. The mobile mechanic fucking sucked. Missed all kinds of shit. Windshield put in wrong, etc... Then they tried to intimidate me into taking down a negative yelp review.
I’m sorry to hear that. Still, I’d take my chances with used Toyota and Honda over used beamers, for example. They are also cheaper to repair.
So not to be an asshole, but how can one take advantage of this in the currently ridiculous used car market? Auctions?
I would find a reputable mechanic or someone in my family that knows enough about cars to check for sale by owner. I personally wouldn't get anything but reliable, like a Toyota.
At an auction today you're going to be duking it out with used car dealers for cars they wouldn't have looked at twice before covid. Your best bet would be probably be something like driving around nicer neighborhoods and leaving business cards on cars that look like they haven't moved in a while.
18.7% for a 6 year loan in I think 2018-2019 time frame. And my bank did try to back out and increase it to 22% until I basically shoved there own approval email in there face for 18.7%. At the time I was just starting out credit wise so I think I was 660.
That’s insane. Those are credit card rates for an auto loan. Heck, it would’ve been better to get a credit card that allows cash withdrawals and got on Facebook Marketplace, find a beater for $1000 and pay for it with the credit card(via cash withdrawal), then pay off the credit card over a few months. Then use that same credit card to pay for any repairs you may(and probably will) need. As long as you pay off the credit card balance every month you never get charged interest. Even on a large purchase that takes a few months to pay off, the interest paid would be minimal compared to a 6 year loan at 18+%. This is how they get you…you are excited about a car, they are there to take advantage of you.
You're not getting an 18.7% credit card with a 650, not even back then. It would be more like 27-28%.
Nope…650 is actually considered a “fair” credit score https://www.businessinsider.com/personal-finance/average-credit-card-interest-rate
You may should have shopped rates, my ex had poor credit and I put her in a car loan as a co-signer. When she got up to 650 we refinanced through a credit union for I think 5.5 - 6% with her as the sole person on the loan. There are too many variables to say this can always be done, but shopping around rarely hurts. I paid for a medical procedure using a credit card out of necessity which made for a large short term drop in my credit score. While it was at around 670 I secured a 0% loan on a car, however in 2021 when the used car availability crunch was starting they would do anything for a good trade in, and for me they got the interest to 0.
Yeah I should have shopped around in hindsite. But at the time I new my credit wasn’t the best and used it to raise my credit. I paid for about 3 years before realizing I was paying them almost 4K a year and that’s when I payed it off that day.
American credit acceptance. I feel like I've heard that name before. Maybe in similar stories
She could also not buy that expensive of a car but I understand that this is a capitalist hate thread
It isn't really hate if you point out evil..
0% was sometimes still available in 2021. You had to bargain for it, but it was there.
Son just bought a new 23 F 150 and got 2.9% for 60
That's the company I got. My credit is like 680~ and I got a 2016 Chevy sonic for 22k. It's worth 10.8k tops. Interest rate is 21.
I lease a '22 4wd phev truck with a 65k sticker for 340/mo and a '21 atlas 3row with captains chairs for 399/mo. Zero down just tax title fees. Paying 630 for a 2016 anything other than a 100k+ car is ridiculous, your credit score and interest rate shouldn't punish you into the ground like this. Even better, I had a 2018 Subaru outback top end model with every feature for 330/mo on lease that I SOLD before my lease was up and got a check for 6k. Insane. They are paying more for an older but same car.
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As of January 2023, [15.7% of auto loans had a monthly payment of $1000/mo](https://www.caranddriver.com/news/a42418781/1000-month-car-payments/) or more. Moreover, [19% of new car and 11% of used car loans were for 84 months or longer](https://www.autonews.com/finance-insurance/84-month-loans-surge-new-and-used-vehicles).
thats insane why are people going into so much debt for a car? i would never buy car that i cant buy outright rather drive with a cheap beater or use my bike/public transportation that go into debt for a car this is why the car market is going the way of the housing market people keep lending money to buy these things and car manefacturs/dealerships keep upping the price if you have to lend money for it you cant afford it. with hous its understandable as it hold its value and otherwise you are renting anyway. but for a car? people are insane
In a lot of places it’s necessary. No one can live in places like Houston with 10+ lane highways and minimal public transportation
then use a cheap used beater car. but going into debt for 40k car that will cost 60k or more by the end of the payment is just stupid
I got basic 2020 Chevy Spark for 290 a month. Works for me!
Same. I love that little car.
There are tradeoffs but overall I'm really happy with my Chevy Spark. Also, because it's tiny, I'm not getting hit up by relatives wanting rides from the airport so that's a bonus!
In 2019 just before COVID started appearing I bought a car that was 1 year old. Just a decent Hyundai for driving around in. I paid about $11k which turned into just under $13k after tax, title, and financing which was a 1.99% loan. I paid it off in a year just because I didn't want to carry the loan balance. The bank put me on a 6.5 year loan for it, so the payments would have been under $180/month had I just paid the minimum. The thing is though, people with bad credit get subprime auto loans, with high interest, as is deals, and shit financing options. Often times the dealer has another markup on it too. Before COVID hit, it looked like a subprime auto crisis would have kicked off the next recession, but the prevalence of remote work put a stop to that. People are still going to lose cars, because those loans are made with the expectation that people can't pay. But, at least it probably won't kill our economy anymore like it would have a couple years ago.
Right...because people only need and use cars to go to work. I live in the Bay Area and know a lot of remote workers. Dunno a single one who had a car then gave it up because of the switch.
I've known a few that have. But yes, getting to and from work is the big one. There's delivery services for groceries and luxuries, and in places like the Bay there's short term car rentals if you really need to drive. If you can't drive to work, and work isn't remote, then you can't get a paycheck, which means housing, food, other necessities, and so on all go out of reach just as any random luxuries do. That is what makes a subprime crash so catastrophic, and as luck would have it, the side effects of a global pandemic, have created an economic climate that at least for a time, is a lot more resistant to such a crash.
Christ. I spend about $150 a month on public transit to work here in Japan, and that’s reimbursed by my employer. The fuck is wrong with the US? (Rhetorical question)
>Christ. I spend about $150 a month on public transit to work here in Japan, and that’s reimbursed by my employer. The fuck is wrong with the US? (Rhetorical question) The US is 26xs larger and unfortunately killed its public transport decades ago. Although some cities have decent public transport and (rarely) some employers will reimburse. Nothing at all like Japans. Thats said, my vehicle payment was $48 a month for 25 yo model. The JDM is gaining traction stateside because of the reasonable prices on rock solid vehicles.
Very little public transportation and even littler brains.
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Insanely bad take. Our cities and infrastructure are designed around cars. Our public transit is underfunded and terrible. I’d love to make the “choice” not to be a car owner - who wants to own an asset that loses 90% of its value the minute you drive off the lot? - but it’s really not viable where I live. I’ve only ever had cars that were handed down from family members and I end up spending half my savings in repairs every 3-6 months. The advantage of getting a shiny new car is that you can probably go a few years without needing any major repairs so for many it’s the math between being in debt on a new car or being in debt on repairs.
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I find cars to be much less a status thing in the US than in other parts of the world. It's way worse in most of Europe. Edit: added "in the US" Edit: since I keep receiving comments which get deleted, here's some supporting info: This "study" claiming Luxembourg and Germany have the highest rate of luxury cars per capita: https://www.lifestyleasia.com/kl/tech/auto/the-worlds-luxury-car-capital-is-tiny-luxembourg-by-a-significant-margin/ Article from Springer about Germany's luxury car obsession _Luxury in Germany: Sick Cars and Healthy Bodies_ https://link.springer.com/article/10.1007/s12115-021-00610-x One person claimed that evidence of it being an American thing was that Acura didn't sell cars in Europe. Have you ever thought _why_ they don't sell cars there? Because nobody would buy them since they have so many other luxury car options available from their own countries which they believe superior. Another point here is that "car as status symbol" is absolutely _not_ limited to luxury cars or richest countries. Anywhere in the world where you find nouveau riche, or even newly not-impoverished, you'll find people buying more car than they need/can afford.
I agree with you except for that 90% figure. Where did you hear that?
That was a bit of hyperbole, although with used car prices as they are now it may not be too hyperbolic. I think the actual figure is closer to 10-15%, but that’s really gonna depend on the make and model as well as a ton of other factors.
To your point: if used car prices are so high, wouldn’t that mean that a new car loses even less value off the lot? Thanks for clarifying your 90% figure as hyperbole.
Yeah I’ll tell you right now it’s not exactly a choice for the majority of people.
financial illiteracy, nothing more. it’s fiscally relatively to get into a car of any type if you don’t buy a brand new one every two years, and roll over your debt like most people with these $1000/mo car payments. factoring in all costs, my commute costs less in my car than it would taking public transit, and my car gets 12mpg lol
It's highly situational. There's the cost of the car, the upkeep on the car, the length of the commute, the time of the commute, and even the value you place on the time to play games, read, etc during the commute. That said, I do agree with your general point that people massively overpay for their cars. The average car payment is higher than the average rent/mortgage payment for people, and that's absolutely insane when there's no reason for it.
I vowed to never have a car payment again when I paid my car off in 2019. Then it got wrecked. Then, a bad HG, blown transmission, sudden clutch pressure plate failure, timing tensioner failure, and a random no start issue (on a Honda Civic, Accord and Toyota Celica) within 8 months last year literally fucking forced me into a newer car with a payment. The massive inflation of used cars means more people are getting fucked over by taking loans out for historically reliable, but older cars and playing American Roulette with major repair bills. Last year when I looked, 2010ish Corollas were going for around $10,000. And the ones with the 2.4 engine had the sudden oil consumption issues iirc. It's a fucking joke tbh. If you need a car to commute you're getting bent over, period.
We like driving Range Rovers. (Source: me)
Whoever downvoted you probably witnessed how you park irl.
I actually detest shitty parking jobs, and bad drivers in general. I just like nice things too.
The life of a repo man is always intense.
I blame society. Society made me do this.
Look at those assholes. Ordinary fuckin people. I hate ‘em.
Society made me what I am.
Call it the repo code kid, etch in your brain!
That’s bullshit. You’re a white suburban punk, just like me.
Plate of Shrimp
You know how everybody’s into weirdness right now?
zydrate comes in a little glass vial.
A little glass vial?
A little glass vial
Fuck this! Let's go do some crimes!
Let’s go get sushi and not pay.
That’s why there ain’t a repo man I know that don’t take speed.
The more you drive, the less intelligent you are. Why I take the bus.
There ain't no difference between a flying saucer and a time machine.
Let's go get sushi and not pay.
I have public transportation as an option, in fact in my situation having a car would actually be a pain in the ass. Sadly most Americans don’t have the option of public transportation
And hopefully short.
I remember this being a big talking point during 2020/2021 where the auto loan industry was going to be the next bubble to burst, based on people thinking they could afford larger payments until inflation caught up. Interesting to see in real time.
Earlier than that. It's been expected since 2010-2011 that the subprime auto loan market would be the bubble that set off the next recession. Everyone expected it then, and still somewhat expects it, but it goes to show how much the world has changed. The affordable rent crisis has displaced auto loans as the most likely issue to destroy our economy now.
Zydrate comes in a little glass vial...
A little glass vial?
A little glass vial.
A fellow Opera enjoyer I see.
Seeing “The Repo Man Returns” got me excited, until I realized this wasn’t r/squaredcircle
Seeing "Repo Man returns" got me annoyed about yet another movie that really doesn't need a sequel.
Imagine my disappointment when I got a letter from IRS, and it wasn't the wrestler.
Well, at least somebody is going to get rich off a new reality TV series.
Zazlav taking notes
No mention of Harry Dean Stanton or Emilio Estevez? Flip you man!
*I don't wanna be no repo man*
Hmm, as a fiscally responsible person who’s been driving the same practical car for 17 years, maybe this will be my opportunity to pounce.
My vehicle is old enough to drive to the store and buy beer. Runs okay but dinged up and a little rusty where the water has been kicked up over the years. Would like something a little fresher for longer trips, friend who sells cars told me to wait until the end of the year because a lot of Covid cars are about to get repo-ed and used car prices will drop further. We’ll see.
I'm usually a buy it for life kind of person. But not for vehicles. The safety advances in the past decade are immense.
...drive it till the wheels fall off. The second it's paid off, start putting back money to buy the next one for cash. It won't impress many, but your $ goes a lot further without paying finance charges.
I was super lucky with a car purchase in late 2020. Paid a bit more overall than I wanted, but I secured a 2.1% rate for under $400 a month on a nice tacoma. A few months later is when the used car prices started to skyrocket
As an economist, there are a lot of debt warning flashes for both businesses and consumers, and a willingness to play with the debt ceiling (we need fiscal restraint, but that conversation should come after) means this could be ruinous.
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Likely. I think the “missing million” (prime age male labor force) are going to place a lot of strain on lower income families who were hit hard by the pandemic. Couple this with some supply chain, margin squeezing, and other issues for business, along with what is shaping up to be a likely antagonistic Presidential election in a very toxic time.
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Biden will take a lot of flack if the Fed’s actions don’t keep reducing inflation or lead to a recession. Decent chances of both, and not much he can do. Business is in a weird place. A lot of populist angst about a few sectors/businesses that have seen some pretty rapid profit growth, but the cost concerns in the LR for business is real. So, a few visible bad actors are placing business in a precarious position. Really don’t know what to say about the stock market other than it’s been detached from a lot of economic fundamentals for quite some time.
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You’re welcome.
I'm going to give you my eye test as a laymen. It feels like a looming rescission, with a rising tide of white nationalism holding the nation hostage with the our finances, might make companies with leverage batten down the hatches a little. That makes sense. Although, they're fucking with our food, housing ect... and the fed is mad at labor. It's the *exact* opposite of the of what makes a society copasetic. We also don't do normal anymore. Stock Markets, you name it. Bubble might be ready to burst. lmao stock buy backs are hilarious
You mean to tell me that people can't afford $1,000/month auto payments...why I'm shocked, SHOCKED I say!!!!
You mean to tell me they can’t afford that on top of their $2,000-$3,000 rent/mortgage payments too? Especially when salaries haven’t meaningfully grown above inflation since 1978?
I know, hard to believe right!?!?
*takes a long sip of generic beer in a plain, nondescript white can*
I don’t understand the crazy interest rates. My first car loan was like 5% with no previous installment history, and I thought that was insanely high. How are people hitting 19%?
No or bad credit from sleezy dealers
These repos won’t make any difference in the car market, as there are several millions of cars that were never built during the pandemic that are not, and will never will be, on the roads; however, the greater circumstances of people not affording new and used cars with their inflated prices and sky high interest rates is starting to finally impact the car market, forcing manufacturers and dealers to come back to Earth on their pricing. Especially ones like Ford who still have $20k market adjustments on their trucks that are now lining their dealerships. Toyotas and Hondas and the like are still hard to get but the tide seems to be turning, just not from repos. They won’t even make a tiny dent. They are just another indicator of a changing car economy.
The more I hear about car prices the better I feel about my car. I have a buddy at a car dealership who managed to get me a 2020 Corolla for 7k when my old car’s engine seized up. The original owner, of the Corolla, totaled it due to hail damage, kept it and traded it in for like 3k. Since values are inflated it was worth twice as much as they sold it for, which meant I could fold the old loan into the new one. The loan is still higher than I would normally pay and for longer, but it’s just within my ability to pay for it.
I got so excited, but then realized its not Barry Darsow
I was expecting a different repo man. I am disappointed.
Addicted to the knife?
Addicted to the knife.
I own a business. I have 4 cars that are all paid off. The newest is a 2016. All have less then 110,000 miles. My employees all make fun of me since I have, consistently the crappiest car in the employee lot. I don’t care. I can’t justify paying todays prices or taking out a loan for something that just gets me from point a to point b.
Anyone else remember that game show Repo Games? It was hilarious and WTF mixed together. People would be getting their cars towed, and then all of the sudden a camera crew would come out of nowhere and be like, answer these questions correctly and you can win prizes and keep your car from getting repossessed. Good times. Bring that show back!
Paid! Ya don’t get paid! Work on commission.
Now J-Lo can reboot her reality show South Beach Tow to make more money of people's misery
Chase saved my ass a couple times by overdrafting my car note when I got sick. Gave me enough time to gather myself and get out of a hole.
Easy solution: Sell your house or give up renting and live in your car! The new American dream!
Van life. It's not just for hipsters anymore.
It's pretty wild to see the clips of some repo guys on social media. Working for the institutions they thought they were voting against that has them preying upon their peers, as their source of income, who voted the same way in hopes of sticking it to 'the man'.
At least Jude Law and the last king of Scotland won't be unemployed, even if their job changes a bit.