A record 7M Americans are 3 months behind on their car payments | Hacker News Reader

A record 7M Americans are 3 months behind on their car payments

washingtonpost.com

26 pointsmontalbano28 comments

"Some cars are installed with devices that prevent the car from turning on if someone misses a payment and it has become easier to geo-locate a car to tow it away."

Well that's terrifying. Even more of a reason to buy used, older cars with less mileage.

You've never heard of the repo man? If you hold property that is collateral for a loan, you don't really own the property; the lienholder has extensive legal rights in the case of default.

> Even more of a reason to buy used, older cars with less mileage.

You must pay cash. Cars mentioned with an interlock are sold by "buy here pay here" dealerships, which are essentially borderline usury lenders by way of used autos.

https://www.npr.org/sections/alltechconsidered/2014/10/16/35...

Or don't go to dealer that require interlocks.

Just speculating... How many of these are ride-share drivers who purchased a new car for that purpose and can no longer meet payments once the driver market became saturated and fares dropped?

> How many of these are ride-share drivers who purchased a new car for that purpos

Don't think it's that much. Ride-share companies ( Uber and Lyft) allow drivers to lease vehicles from them for as low as $170 / week, so unlikely that there are that many drivers have bought cars on loan for this purpose.

Source: My friend here in SF who leases from Lyft.

You do realize $170/week is $680/month, and for leasing that is extremely high.

I shudder to think what the high end is if you say "as low as"

It's high compared to a typical lease, but a typical lease also generally includes significant penalties if you go over 10,000 - 12,000 miles per year.

$680 isn't unreasonable considering the accelerated rate of depreciation and wear & tear that would come with the amount of miles a full time rideshare driver is going to accumulate. And will be mostly all tax deductible, due to the bulk of mileage being business travel.

I have never driven for lyft, so my follow on question would be assuming 20 hr/week and 40 hr/week, what is the average and std dev of the wages of a typical lyft driver?

I ask because though that is a good point, that is dangerously close to indebting a lyft driver to the company. Make them pay a huge cost for a car, and they have to drive more to make up for it.

To put it in a different context, my loan for a $20k car over years was $450/month.

I’m curious, how many of you out there Pay off your car loan and keep the car for many years, without buying a new one or upgrading?

Just go rid of my first car that lasted 20 years. Currently we have two cars which are 7 years old. Hope to keep them till they are 20 years old.

Our first two we only kept five years, bought new too. After we got older and smarter about buying cars, our last two were bought used. One is now 13 years old and the other is 3. We hope to run both into the ground, which may be a while (thankfully).

I've had mine for just over a decade now, bought new, paid of the load in 5 years. Hoping to not need a new one anytime soon.

The first car we bought with a loan was a 1994 Accord station wagon. We traded it in about the middle of January, 2012. I forget whether we took out a loan on the 2003 Accord sedan. It might yet be on the road, but somebody with 4Runner sideswiped it in April 2016.

I kept mine for 10+ years. But not by choice. Could not afford to replace it. When it broke with potentially high repair cost, we purchased used, off lease car from dealer. Credit union offered good interest rate.

Never buying brand new car again. Always slightly used car from now. And hopefully cash, with no interest.

I bought a used '05 model in 2013 and still drive it. It has aux input, and heat/air conditioning work, so I'm not really sure what else I'd need.

Actually a newer more expensive car might be a downgrade, because right now if someone dents my car, I feel zero stress.

Mine is 7 years and counting, bought used at 1yr 12000 miles. Hope to use it at least another 7. My first car. Never really been fan of luxury cars, but have a soft spot for older american cars, 60-70s in particular.

Purchased in 2005, paid off in 07, and still driving it for at least 2 more years.

From what I know about history, the middle class in America has been having problems with debt since at least the early 1800s.

A related trend, is that the length of the car loans is also increasing. 84 month loans are not uncommon now.

Couldn't get past the paywall even by clicking on web so I read the story here

https://www.nydailynews.com/news/national/ny-news-auto-loans...

it says

>There was a marked difference in delinquency rates between bank vehicle loans and dealer-financed loans as well, the feds noted, with 6.5% of the dealer-originated loans being 90 or more days past due, compared with just 0.7% of such loans granted by credit unions, the Federal Reserve noted.

I'm not American so I'm not familiar with how you guys do things down there; but is it possible that this whole thing came about as a result of dealers handing out easy loans as a way to move inventory?

I mean the risk is relatively low for them right, they can always repossess the car and resell it themselves so it seems worthwhile for them to finance everyone even if they have no hope of keeping up with their payments. Heck even here in Canada one of the local dealers has a radio jingle that goes "no credit checks, no credit checks, we finance everyone." It seems foreseeable that practices like that, when done at scale could result in a large quantity of loans sitting in arrears

Employment rate is such a perverse metric.

Our metric must take into account the quality of employment as well.

If people just learned the basics of maintaining and repairing vehicles they'd save themselves thousands of dollars by buying auctioned off used cars and repairing it. Same thing for taking it for a shop for maintenance...

Some states require dealers licenses to participate in auctions. But if you know a guy with a license, you can score amazing deals (which are only amazing because of the limited pool of bidders).

I think knowing how to fix cars is valuable, but I don't think doing maintenance yourself generally pays off. I'm pretty handy with a car, but the only maintenance I do myself are brakes and batteries. Tires require special tools, so those are out for the shade-tree, same with suspension (which requires alignments after installation). I've found that oil changes, air filters, wiper blades can be done at the dealer for about the cost of parts (at least for my Ford and Toyota).

Now, as far as fixing repairs. Most mechanics, especially at dealerships, will toss parts at the problem. So knowing how to research the problem can help save you a boat load of money, even if you do none of the physical work yourself, since you can come in and ask for them to perform some specific fix. Additionally, lots of sensors are easy fixes if you can follow direction on YouTube/forums.

"but I don't think doing maintenance yourself generally pays off."

Kinda depends on how much an hour of your time is worth. Maybe an oil change is worth paying someone for (most shops don't charge much for an oil change). If you are really mechanically savvy you can save hundreds of dollars though.

I bought an extremely-cheap Evo X (like ~$5k cheaper than average)....the car came with a bad Active Center Differential Pump, which is a $1500 part. I ordered the part at Mitsubishi then put my car on jack-stands at my home and changed the part myself. Then ran the computer software necessary via my laptop and a specialized cable to flush the pump fluid as well. Took me a Sunday afternoon but saved me hundreds of dollars in labor. Plus I now have a car with a brand-new pump that still cost me THOUSANDS of dollars less than any other Evo X that was on the market here.

Suspension maintenance is not out of the question for the home mechanic. You can align the suspension to an accuracy that's safe to drive for short distances at low (not highway) speed. All you need is a level, a tap measure, and a little bit of high school math. I have saved quite a bit of money doing this.

Edit: Of course, you'll want to drive it to an alignment shop right away.

I routinely win bets with alignment guys doing string and plumbob alignments on level concrete. Its not hard, as much as it is laborous.

A good point - a buddy uses certain commercial entities which will bid for you, for a little price of course. Apparently it's rather casual!

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