Miss a Payment? Good Luck Moving That Car | Hacker News Reader

Miss a Payment? Good Luck Moving That Car

dealbook.nytimes.com

60 pointsspking80 comments

If we skip the moral indignation and look at the situation plainly, this sort of technology enables a whole subset of people to actually own cars that were considered too risky before. That's a good thing. Given the choice between no car and a car that won't start if I don't pay, I'll go with a gimped car.

Yeah, if they wanted to be evil, they'd do deals with the gas companies and the further behind your payment is the worse your gas mileage

That'd be illegal under US gov't. regulations.

While I think the whole situation is ridiculous (how would you even make a car less gas-efficient on the fly?), consider the many laws broken each day by large companies with the $ to make the suits disappear.

> how would you even make a car less gas-efficient on the fly?

My car has a 'sport mode' which seems to do a pretty good job of this ;)

I love it. "You can't afford to make payments, so we will make you less able to make payments."

It also affects a population of buyers who would have been sold an ungimped car before, but will now be sold a gimped car

That's not a good thing.

How the two factors balance out is not obvious.

>sold a gimped car

You haven't exactly purchased it until all of the payments have been made.

Once it's actually yours, I imagine you're free to remove the tracker.

you don't own your apartment, but renter laws generally forbid recording and spot inspections by landlords...

>forbid recording

True. But as for the inspections... In Canada my landlord only need give me 24 hours notice before they enter my apartment whether I agree to it or not. It's not even necessary that I receive and confirm their desire to enter. Simply a note on or under the door 24 hours prior is enough.

Even worse... all a landlord must do to enter my apartment without any notice given at any time of day is deem their entrance an emergency.

If I owned my apartment and all payments had been made, this could never happen.

http://www.ltb.gov.on.ca/en/law/STDPROD_078964.html

There are upsides, but it sounds like we need some good old-fashioned consumer protection legislation to protect consumers here.

Mandate no location tracking or car shutoff for owners who aren't 30 days past due.

Mandate that there be a 24/7 line for emergency car re-activation that is clearly posted in the car.

Mandate the provision for 1 non-emergency temporary reactivation to avoid stranding people.

The three of those seem like they would go a long way to to assuage people's concerns.

EDIT: changed 'two' to 'three' since I apparently can't count...

> There are upsides, but it sounds like we need some good old-fashioned consumer protection legislation to protect consumers here.

That's an idea that people have given up on in the US. The only consumer protection legislation I ever hear about is in the EU.

Sounds like stuff that would easily be solved by the market (of course it would be demanded, and of course it would be provided for the right price) if this becomes common practice. No need for legislation.

EDIT: Downvote away, but let us remember that having/operating a car is not by any means a basic human right that needs to be protected by legislation. On principle, do you think that if you live across the street from a car rental lot, you should automatically have "emergency" access to any car on the lot at any time? We're talking about essentially renting access to a car that may happen to be parked on your own property, and if you haven't paid for access to the car (or for access to emergency use of the car), then you really don't have any more inherent entitlement to its operation than you do to operating a car parked next door.

The negotiating position of people with these devices is already close to nothing. Auto financers can make it a take it or leave it situation, and the consumers often have no choice but to take whatever deal they're given. Especially so if they need a car for work.

If you disagree with what I mentioned, I'd love to know why.

Bicycles, buses, walking, bumming a ride, jitneys, trains, motorcycles, scooters, and so many other ways of getting there.

But that'd require some initiative.

The per-capita car ownership rate in Singapore is 12 cars per 100 people (or 1 car per 8.25 people). - https://en.wikipedia.org/wiki/Driving_in_Singapore

... because the number of cars (well, COEs issued) is strictly capped by the government.

In most of the world, driving a car is an expensive luxury. Even here in Canada insurance for a young male is $4500 a year and gas costs $4.50 a gallon. Regular middle class students and teenagers do not drive, they walk or take the bus, often in blizzards or freezing cold temperatures. Getting a car is something you do when you've graduated and started a full time job.

Having to actually pay your monthly payment so that you can travel in comfort in a personal automobile is really, really far from oppressive.

Who said it is a right? Getting payday loans or owning a credit card are not rights, yet we regulated the lending industry in those cases.

I agree with mandates. However, I do not believe that a vehicle lease agreement should be treated like a cell phone contract. It should be treated more like a home loan. I would be concerned if people could sign home loans that the penalty for default is that you can only come inside when its cold.

In an emergency, declaring the emergency to the car could be problematic, especially if its not the usual driver.

The crux of your argument is that "consumers often have no choice but to take whatever deal" and that lack of choice makes this issue important enough for the government to step in. Is that right?

I strongly disagree, because there are options to: * Own a less expensive car * Take transit * Ride a bike * Find a closer job * Find a closer house * Ride share

Now, you can probably craft a specific story where none of those are an option. Let's say a single mother living in section-8 housing with limited job prospects who is already driving a really old car and who found one job 20 miles away in an area with no transit. That's pretty bad, and it represents failures of our system at multiple levels. First I would propose spending government time to address those core issues before burning time on this symptom. Second, all these rules will make the car more expensive; it's a slight tax on the responsible paid by those who might miss payments. Third, this case is rare and it's unclear its worth the cost and unexpected consequence of regulation.

You can disagree, but your disagreement is based on incorrect assumptions about the availability, reliability and proximity of public transit, work to housing, etc. Your "specific story" that you think is "rare" isn't as rare as you think it is.

> The crux of your argument is that "consumers often have no choice but to take whatever deal" and that lack of choice makes this issue important enough for the government to step in. Is that right?

No, that's completely wrong. "Lack of choice" is not the only or main argument for consumer protection. We don't regulate the arsenic content of toys because parents have no choice but to buy commercially made toys.

The argument is "consumers are being treated by some bad actors in a manner by that interferes with their safety, privacy and dignity". The solution is to look at what the good actors are doing, and mandate that behavior to protect consumers.

> First I would propose spending government time to address those core issues before burning time on this symptom.

Why? Those core issues are incredibly controversial. We shouldn't avoid regulating a new means of loan efforcement because we can't solve fundamental social issues.

> Second, all these rules will make the car more expensive; it's a slight tax on the responsible paid by those who might miss payments.

What are you talking about? This technology (as discussed in the article) only applies to people who's are being offered subprime car loans and are a high risk on not paying. Additionaly, the technology in question should REDUCE the loan costs of subprime auto loans.

> Third, this case is rare and it's unclear its worth the cost and unexpected consequence of regulation.

What are you talking about? The article doesn't give clear numbers for the US market for this technology, but it doesn't seem to be particularly small. "Corinne Kirkendall, vice president for compliance and public relations for PassTime, which has sold 1.5 million devices worldwide," "Roughly 25 percent of all new auto loans made last year were subprime, and the volume of subprime auto loans reached more than $145 billion in the first three months of this year."

Here is a plausible case: girl dates cop, he creeps her out so she breaks up with him. Cop harass her at some dark parking lot, she tries to run but can't start her car because cop had the interlock activated on her....

Why would he abuse his authority in what is likely a traceable way when he could just slash the tires or what not?

Ok, ignoring the moral repugnancy of the whole thing for a moment.

> T. Candice Smith, who testified before the Nevada Legislature that her car, which had a starter interrupt device installed, was shut down while she was driving on a Las Vegas freeway, nearly causing her to crash

> Others said their cars were shut down while idling at stoplights.

How the hell is that legal?! Surely you should only be able to disable a car when the engine is not running just on safety principles.

It is likely untrue, but anecdotal. That said, how are subprime loans still legal??

They'll remain legal as long as they're at all profitable and that profit exceeds any fines or losses in lawsuits.

It is likely untrue...

Why do you believe this?

Because for someone to believe the ability to stall a moving car is ok is for them to believe the passengers are potential acceptable losses.

More likely is someone who has had a remote start block activated in the past (keeps you from starting the car) likely experienced engine failure while the car was running and associates it with past experiences.

This has no bearing on any argument for or against this practice, in any way. If it was found to be true that the engine could be remotely stalled while moving, it would be horrifying.

> Because for someone to believe the ability to stall a moving car is ok is for them to believe the passengers are potential acceptable losses.

This isn't as outlandish a thought as you imply, especially when it comes to vehicles and the sales practices around them. Also, someone could believe it's okay to stall a car at any time without even considering the ramifications in the case that it's moving. All they need to be thinking is "deadbeat owes me money, brick his car." Any questions of timing, context, ethics or other considerations needn't enter into the picture.

Yes, it _is_ an outlandish thought. The folks who design and manufacture auto parts of this type have to think about this stuff, or else they'd be quickly sued into oblivion.

Because for someone to believe the ability to stall a moving car is ok is for them to believe the passengers are potential acceptable losses.

No, it only requires them to fail to test that their device cannot be used to shut off an operating car. Stop and think -- what criteria define an "operating car"? It's not "the car is on" since it's entirely possible to stall out while moving. It's not "the car isn't moving" since that doesn't cover the stoplight situation. It would be trivially easy to code a device that would not permit the car to be restarted even if the car stopped in a dangerous situation.

I assume you're talking about the subprime home mortgage debacle? Because the issue wasn't that the loans were subprime, so much as it was the massive amounts of institutional fraud across many layers of the mortgage business that enabled unqualified people to get loans (or loans larger than they qualified for). IOW, subprime loans were the murder weapon, not the murderer.

EDIT: BTW, a subprime loan is just a loan that comes with terms that aren't as good as they could be due to the applicant having some sort of issue in their application (eg, no credit history, a bankruptcy, lots of missed payments, no collateral, lots of other debt, etc.).

You are right, of course, but (IMHO) it sure would be nice to have consumer protections against such weapons.

Why would a subprime loan be illegal? The price meets the risk of the loan. It's a wholly logical agreement that provides potential benefit for both parties.

Of course it's not legal. However, the article also quotes the "other side" claiming that it's impossible for the device to do that, and the manufacturer claiming that the device has is not designed to do that, and that they have no record of it doing such a thing. And on their website they say the device "can never shut down a running vehicle."

So...presumably either Smith is mistaken and/or lying, or the device is defective. It's possible that her car broke down on the freeway, and she assumed it was the starter interrupt when in fact it was not. But it's exceedingly unlikely that the device did so while operating according to design.

(Or Passtime is about to get one humongous fine and/or judgement...)

Any company that did this would be risking crippling judgements. And it doesn't look like the technology (starter disabling) permits it.

Cars die. I once had an old car, a Saab 900 SPG (160 hp!), which completely died when I was going at speed on I-78 in the left lane. Turns out it was the ECU. I managed to coast to the side of the highway without incident.

Most of the cars mentioned in this article are older ones, which would have more mechanical difficulties. Put another way, if you can buy a nice reliable 911 Turbo S to cart your groceries around in, you're probably not doing that with a subprime car loan.

Passtime really should embrace the full Micheal Barr treatment toothsweet.

So...presumably either Smith is mistaken and/or lying, or the device is defective.

But the manufacturer, of course, could neither be lying nor could have produced a device that didn't perfectly represent this notional design.

This entire thread is full of people who have no idea how the device actually works or what actually happened jumping to the conclusion that the female poor person is lying or doesn't understand what happened with her own car that she was driving at the time. It is, of course, possible. But it's also classic Hacker News.

The article doesn't provide enough information to know specifically how the devices really work, but people blaming mechanical systems for driver error is nothing new (see Audi and Toyota unintended acceleration cases).

The company can not lie in this case because it would be trivial to expose the lie by studying any device in the field. I think its more reasonable that she is blaming the device because she was in a scary situation and the device is the best cause given her information. I think it's safer to assume no one has hidden motives here.

So I say:

> ...it's exceedingly unlikely that the device did so while operating according to design. (Or Passtime is about to get one humongous fine and/or judgement...)

In other words, I'm saying that it might be defective, but it's unlikely (albeit possible) that the company is lying, due to the massive liability this would incur. And your response is to suggest that I'm saying it's literally impossible for it to be defective or for the company to be lying?

In short: You replied to someone suggesting that the device might not be operating according to design by complaining that nobody is suggesting this. I don't believe you are discussing this in good faith.

I used to work at a company that sold devices for exactly what this article is about. One of the biggest selling features of the device was the fact that they could remotely stop a car from starting. I can't speak for any of the companies competitors but I know the devices we sold were not possible to shut the vehicle off, only disable the starter after it's already been turned off.

Highly doubtful the car just shut down (unless she perhaps stalled the car). Article mentions the device is tied to the ignition.

Can't onstar shut down/disable cars that are reported as stolen, even when they are on and in gear and moving?

I don't think this is onstar. It's a third party device attached to the ignition. Ignition interlocks have been around for a long time -- though not tied to gps device as they are now.

It can, but it's a very different device. Rather than preventing the vehicle from starting, OnStar talks to the engine computer and can slowly reduce power, or, yes, cause it to come completely to a halt. But OnStar is also careful about when and how they do it.

See, for example, this story where OnStar waited for confirmation that the cops were directly behind the car: http://www.theblaze.com/stories/2012/07/18/cant-just-shut-it...

Or this story about the slow down feature: http://www.autoblog.com/2007/10/09/onstar-debuts-stolen-vehi...

So basically, OnStar can shut down moving vehicles, but they only do it with the involvment of police (as far as is known). Whereas the auto loan ignition interrupts cannot shut down moving vehicles, but can be triggered with no oversight. Apparently.

It should give a warning before shutting down, and then only shut down overnight, when nobody is driving it, to ensure people are at least back at home or at a reasonable place. There's no reason why it needs to be able to shut down at a moment's notice.

My hypothesis is that the device cuts out the starter motor. So if this sequence of events occurs, you can be stranded at a stop light:

1. Start the car.

2. Once the car is started, the order to cut off the starter comes in.

3. You drive.

4. The car stalls for whatever reason.

5. You can no longer start it.

It might be even easier than that. A lot of newer cars have a gas-saving feature where they automatically stop the engine when the car's stopped at a red light, and automatically start it again when you take your foot off the gas pedal. If you've got a car like that, then every traffic signal could be an opportunity for your car to be disabled.

On a technical note, a "starter interrupt" could not reasonably affect a running vehicle (the starter motor only runs when turning over a stopped engine). However, if these devices actually operate inline with the ignition system--delivering or interrupting spark to the fuel-air mixture during operation--that's an entirely different matter and cause for safety concerns.

It shines light on a troubling broader issue: As information and communication technologies (in which many of us are involved) spread, they put power in the hands of those who control them, from Google to Verizon to your electric company (via your smart meter) to car loan agencies. It gives them power over other people, including whether they can drive their own car.

Not everyone wants to give others this power, but do we and will we have a choice? Perhaps legislators will pass laws protecting the interests of people like those reading HN, or vendors will appease us because of our economic and political power.

It is the poor, powerless, and disenfranchised who will be abused, with little recourse (other than not owning a car, a phone, etc.). If something like what the article described happened to HN readers, there would be an uproar. But these things will and probably already do happen off our radar to marginalized groups.

Perhaps that's why the Internet protocols put control in the hands of the end users.

It's hard to break this down because there are so many different problems going on here, but let's pretend for a minute that the moral issues related to privacy and dignity are irrelevant, and that the arbitrary credit score threshold of 640 that necessitates this system is reasonable and determined by transparent and fair processes (it's not, but stay with me).

Does this _actually_ solve a problem? Are cars that difficult to repossess? Is it possible this is a marketing gimmick and the securities backed by it are sold to investors who just really like the idea of being able to f*ck over a poor person the second he or she misses a payment? Is this really an economic innovation that lets riskier borrowers have cars, or is it a sales tactic appealing to veiled social darwinist sympathies?

The woman who needed a pickup to deliver pizza is symptomatic of a different problem too. In many places it would always be the responsibility of the pizza joint to provide the vehicle because typical consumer auto insurance expressly forbids commercial use. The pizza chains not only pay minimum wage, they also expect their employees to provide the business equipment...

The thing many people aren't getting is that this type of thing isn't limited to one instance and isn't just that business owners are greedy.

Its because the entire economy is being squeezed, turning a profit is extremely difficult, and there are many unemployed people who have to put up with those types of situations because they need money.

Does anyone know how widespread and available the ability is to disable vehicles via OnStar? I heard today that a woman in Missouri had her 2005 Dodge disabled (by a lending institution) for allegedly being 1 day overdue on a car payment. Like, does it go on in all parts of north America, and would it be available for just charter banks, or any joe schmoe money lender? Would anyone also know if there are systems other than OnStar, that will allow tracking/disabling of a given vehicle?

This is very shortsighted. Most people in the US use their car to get to work. Lenders have a vested interest in their borrower's current and future ability to earn money.

The car dealers that regularly repossess customer vehicles print money. I've seen data come across were the dealer's cost of a vehicle was -2,000 because it had been sold and came back a few times.

For those more familiar with cars, a question: when the article mentions disabling the ignition, does that mean that only the starter is disabled, or that the actual spark plugs / fuel delivery are disabled (and there is some check for whether the engine is running)? The former sounds reasonable, but the latter sounds like a disaster waiting to happen.

I doubt the article is being precise, first, and might use one for the other. That said: ignition means the electrical system that fires the spark plugs. Starter is the motor that starts the mechanical bits moving, so the ignition can do its job and keep the mechanical bits moving. Any car with the traditional keyed start even shows these circuits as separate positions on the cylinder. Most motorcycles have separate controls for those two circuits: a toggle switch for ignition, and a momentary switch for starter--you must set ignition to "on" before the starter will do any good.

Disable the ignition system, and nothing's going anywhere. Disable the starter motor, and it's just not going to start--unless you push it down a hill or, say, short the relay with a screwdriver (as mentioned in the article).

While technically you could put a remote controlled relay anywhere (the dome light won't light up if you're late on payments--take that!) it sounds from the description of the device ("starter interrupt") and other clues that it's the starter system that's being killed. And that makes a lot of sense: that way if the device fails it at least won't bother you while you're in motion.

I wish it wouldn't sound out of touch and pretentious to suggest bicycle use as a form of resistance, I really do.

A rough idea of a possibility in the future, the car owner can scan a QR code in the car, confirms the transaction, which is recorded on a blockchain, monitored by a smart contract, which activates the car's engine.

I do believe they signed a contract before getting the lend saying: "It's OK to block my car if I miss a payment by X days."

Why should they complain? If you don't agree with the terms, don't sign.

It would be interesting to see what would you do if your child need immediate medical attention and your car won't start because, apparently, "you signed". ;)

Legal != Ethical

I would call a cab. It's what people who don't own cars do every day. Ethics has no meaning in this context.

Meta: Why is this not on the front page? It has 53 points and was submitted 4 hours ago (and is a technology story to boot). The #5 link on the FP is a story with 26 points and submitted 5 hours ago.

Maybe people should buy cheaper cars if they can't get a reasonable loan? I guess it wasn't clear from the article if these were loans for new or used cars, though.

Yeah, you shouldn't need a loan for a decent used one.

Shouldn't, but might anyway... a lot of folks don't have HN-type dough on hand, and the vehicles in the article were 2005 and 2001 vintage.

You can go a lot farther back than 2005 or 2001. My used ones are from the 80s through 90s and they were only around $600 to $800

A "decent" used car will cost several thousand dollars. The number of people who can easily part with $5,000 is much smaller than you think it is.

"Decent" depends entirely on the SES of the speaker.

Click and Clack have said for 20 years that if you just need to get from point A to point B you can do that with a $500 car, and once a year or so you will need to get a new-to-you $500 car. With inflation that might be $1000 these days.

That car will be one that could break down at any moment. Most people in the income bracket where this might be an attractive option are unfortunately also working for employers who won't graciously accept "my car broke down" as a reason for showing up late to work.

I think you're wrong about that. The used cars I've gotten for ~$600 to ~$800 have been reliable for many years. They're not bad at all. Maybe this depends on where you live? This is from a more rural area

Y'know, it's kind of amazing what's happened to the used car market in the past few years. A few years ago when I was shopping for cars, truly awful vehicles that I would have considered to be prime candidates for cubing were being sold for far more than they were worth. I'm not sure what it is, but my best guess is that the Cash for Clunkers program sucked a lot of supply out of the market.

I think you've got it half-right: because of Cash for Clunkers, tightened lending standards, etc., used supply is down, while demand is slightly up, and the market is now much firmer than it used to be, with less of a discount compared to buying or leasing new. At least that seems to be the case for cars in the "basic utilitarian transportation" and "entry luxury" categories.

What do you feel is reasonable to pay for a decent used car? What do you feel is a normal amount of money to have just laying around, ready to be invested in a car?

My experience looking for a used car in the greater phoenix area says you can't find anything decent for under $10k. Carmax is said to have higher quality used vehicles, but they rarely have anything under $10k (after gov't fees and taxes). Also, in this price range, the mileage is usually 100k+. Nobody keeps maintenance records, so to avoid blowing up your engine, you'll need to immediately spend $500-900 on a new timing belt. Next, expect your high mileage car to have at least one critical part wear out every other month or so.

I searched long and hard and settled on a $6k car. Twelve years old, 150k miles. It was the cheapest car I could find that didn't have any obvious problems (Firestone vetted it; turned out to have $3k+ of problems over the next fifteen months). My income was ~45k. What with all the other bills, I needed a loan.

It's uncommon for a programmer, but the gov't census for the area says a combined income of $40-60k is normal. I know my fair share of single mothers who wait tables for a lot less than half of that.

I heartily dispute the assertion that it's easy to just pay cash for a working car. One last piece of anecdotal evidence to my argument: the ease of selling my high mileage piece of shit car. I put it on craigslist for $1200 and it sold within hours. I described it as clearly as I could: "as is. doesn't work. died and won't turn back on. lots of recent expensive repairs. must tow.".

tl;dr, in my experience, an easy sum to save gets you a car that doesn't run. if you want a car, you need a loan.

My previous two used cars have been ~$600 and ~$800 and they've been running reliably for years. Maybe you just need to know where to look? I do live in a more rural area.

I wouldn't be surprised if location matters. My experience is in the greater phoenix area (not being vague, my search radius covered the entire phoenix metro, queen creek to glendale). I searched craigslist, independent used car lots, regular dealerships, ebay, and lots around town where people park cars for private sale.

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