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Cars are so expensive that buyers need seven-year loans

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Re: Cars are so expensive that buyers need seven-year loans

#31

Post by tschwimmer »

randerson wrote: post #20

My experience is that the base price for a car hasn't increased as much as all the mandatory dealer add-ons they force on you. I'm currently trying to buy a new car and the dealer refuses to sell me one without a Pulse brake light, paint protection, ceramic glaze, wheel & tire protection, floor mats, and prepaid maintenance, and I must trade in my current vehicle. Other dealers in the area all do the same thing. I wa…

Car dealers are a scourge on Americans and a hidden tax imposed via poor legislation. They employ thousands and are generally very wealthy so regrettably they have become an embedded political entity.

I don't know what the answer to them is other than to remove the anti-DTC laws but that seems unlikely.

Re: Cars are so expensive that buyers need seven-year loans

#32

Post by ChiefNotAClue »

carlosjobim wrote: post #13

Motorcycles are a great option for those who live in suitable climate and don't have to text and play Candy Crush while they're driving. You can complement with a cheap car for when you need four wheels, instead of going into years of debt for a decent vehicle.

Motorcycles only seem cheap. Factor in a proper set of gear, like helmet, jacket, pants, and gloves, and you're up another $1k. Also note that maintenance intervals are more frequent. Consumables, such as tires, will be more expensive in the long run.

Why choose that over a used car for $5k? It's not cheaper, nor is it more practical. But I'll agree, on the nice days, it's definitely more enjoyable.

Re: Cars are so expensive that buyers need seven-year loans

#33

Post by sidewndr46 »

carlosjobim wrote: post #13

Motorcycles are a great option for those who live in suitable climate and don't have to text and play Candy Crush while they're driving. You can complement with a cheap car for when you need four wheels, instead of going into years of debt for a decent vehicle.

Right because if you can't afford one cheap vehicle you can clearly afford two of them.

Re: Cars are so expensive that buyers need seven-year loans

#34

Post by kylehotchkiss »

MisterTea wrote: post #15
chung8123 wrote: post #12

Earlier quoted context omitted.

Do RVs have a deprecation cliff since you cannot take old RVs to many campsites?

I just looked that up and apparently there are 10 or 15 year rules enforced by some but not all parks. If the RV is older than 10 or 15 years it will be barred from entry. Apparently the rule is to deter people who do not maintain their clunker of an RV which might break down, leak various fluids or catch fire. The given advice is to keep your rig in good shape and call the RV park and explain the situation. They may…

New dream policy for California: no more 20+ year old RVs street parked in touristy places. They'll end up taking over entire streets around mission bay (a large park in San Diego)

Re: Cars are so expensive that buyers need seven-year loans

#35

Post by sidewndr46 »

MrResearcher wrote: post #14
madcaptenor wrote: post #9

Cars last longer now, so this may not be as bad as it sounds. The real issue is whether people are ending up underwater on their vehicles - that is, are loan lengths increasing faster than depreciation curves are flattening.

The powertrain warranty is usually 5 years or 60K miles. Bumper-to-bumper warranty is around 3 years, I think. I would be OK with the loan for as long as powertrain is covered, at the very least. The modern day turbo engines have exceptionally low reliability, it will blow while you still owe quite a bit for the car.

I'll add a disclaimer here that I don't buy new cars or trucks, so this doesn't really apply to me anyways.

My family's limited experience with powertrain warranties is that they don't mean anything. The manufacturer put a junk engine in my Dad's truck at the factory. When they replaced it, they replaced it with a junk engine. When confronted with this, the dealer claimed it was not reasonable for a replacement engine to run without issues. Neither made it 30,000 miles.

Re: Cars are so expensive that buyers need seven-year loans

#36

Post by sidewndr46 »

MisterTea wrote: post #15
chung8123 wrote: post #12

Earlier quoted context omitted.

Do RVs have a deprecation cliff since you cannot take old RVs to many campsites?

I just looked that up and apparently there are 10 or 15 year rules enforced by some but not all parks. If the RV is older than 10 or 15 years it will be barred from entry. Apparently the rule is to deter people who do not maintain their clunker of an RV which might break down, leak various fluids or catch fire. The given advice is to keep your rig in good shape and call the RV park and explain the situation. They may…

That's an extremely charitable take. Have you ever considered parks just don't want someone who can't afford a new RV?

Re: Cars are so expensive that buyers need seven-year loans

#37

Post by justinator »

mikestew wrote: post #3

Even TFA points out that this is nothing new, as I was thinking "we bought a new car 20 years ago, and 84 month loans were an option". It was an option that few took, but it was there. Now, apparently, 21% of new car loans are 84 months. While we're on the subject, here's one for you: if you buy an RV, you can get a 20 year loan. We technically have one at the moment (it'll be paid off after having held the loan for…

20 year loan on something that depreciates that terrible is predatory.

Re: Cars are so expensive that buyers need seven-year loans

#38

Post by foxyv »

tschwimmer wrote: post #31
randerson wrote: post #20

My experience is that the base price for a car hasn't increased as much as all the mandatory dealer add-ons they force on you. I'm currently trying to buy a new car and the dealer refuses to sell me one without a Pulse brake light, paint protection, ceramic glaze, wheel & tire protection, floor mats, and prepaid maintenance, and I must trade in my current vehicle. Other dealers in the area all do the same thing. I wa…

Car dealers are a scourge on Americans and a hidden tax imposed via poor legislation. They employ thousands and are generally very wealthy so regrettably they have become an embedded political entity. I don't know what the answer to them is other than to remove the anti-DTC laws but that seems unlikely.

In a small town I used to live in, the car dealerships essentially financed the entire town. Their sales taxes paid roughly 80% of the town budget. The dealers could have murdered people in broad daylight and the sheriff would have handcuffed the corpse.

Re: Cars are so expensive that buyers need seven-year loans

#39

Post by garciasn »

gentooflux wrote: post #6
mikestew wrote: post #3

Even TFA points out that this is nothing new, as I was thinking "we bought a new car 20 years ago, and 84 month loans were an option". It was an option that few took, but it was there. Now, apparently, 21% of new car loans are 84 months. While we're on the subject, here's one for you: if you buy an RV, you can get a 20 year loan. We technically have one at the moment (it'll be paid off after having held the loan for…

Marine loans for boats also appear to carry 10-20 year terms. Value being subjective and all, if you find the juice tasty enough then it must be worth the squeeze. Car loans have a bit more of an inherent predatory bent since most Americans need a car to get by. That's not to say we all need a car which costs so much that an 84 month term becomes worth considering...

Boats here cost the same as a car and more, but because they are used far less and have a high resale value (Minnesota has a lot of lakes and a culture centered around water and boating) it might make sense.

I bought a 20yo pontoon for $10K and I could sell it tomorrow for $5K more than I paid for it two years ago.

I cannot do that with a car. No way; no how.

Re: Cars are so expensive that buyers need seven-year loans

#40

Post by justinator »

MisterTea wrote: post #15
chung8123 wrote: post #12

Earlier quoted context omitted.

Do RVs have a deprecation cliff since you cannot take old RVs to many campsites?

I just looked that up and apparently there are 10 or 15 year rules enforced by some but not all parks. If the RV is older than 10 or 15 years it will be barred from entry. Apparently the rule is to deter people who do not maintain their clunker of an RV which might break down, leak various fluids or catch fire. The given advice is to keep your rig in good shape and call the RV park and explain the situation. They may…

There are some countries that don’t allow old cars on the road.
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