Thread 28705474

>CLEVELAND — Here’s just another sign that cash-strapped consumers are searching for ways to stretch their dollar even further.
>I've learned that many car owners are now looking to extend their loans through refinancing.
>And for the first time, Caribou saw 84-month refinance terms have become the most popular choice among borrowers.

As for why?
>Caribou says stressed-out Americans are looking for financial flexibility by freeing up funds to offset the impacts of inflation and rising healthcare costs.
>"We hear some amazing stories of customers that are under pressure and this unlocks their ability to buy a new house, to pay for a new for diapers for newborns or pay necessary medical expenses," said Goodall.

how did it get this bad?

https://www.news5cleveland.com/money/consumer/cash-strapped-consumers-turning-to-84-month-car-loans

>>28705474 (OP)
financial illiteracy and predatory lending.
there's zero incentive to lower, or even constrain costs when easy financing is available.
see also:
>why is college so expensive nowadays?
>why have homes become so expensive?

Car buyers typically negotiate on the monthly payment now, not the total price. Maybe there should be a limit on car loan terms, that would effectively cap the prices. =/

when I tried to get my current car loan, they outright wouldn't do a 48 month term, minimum was 60. at least the rate was prime, the payments are low, and I can overpay to lower/offset the additional interest. it's bonkers to me that 7+ year loans are commonplace

>>28705503
kek

>>28705474 (OP)
Bruh gotta get dat Nissan Altima on credit nigga. New fully loaded on dez nuts.

>>28705474 (OP)
Who cares what the term is if you don't plan on making any payments anyway?

>>28705526
sheeeeit nigga

>>28705474 (OP)
It's morons who don't want to give up their coffees and subscriptions, buying a meal at lunch and a woman who is always broke because on top of that all the throwaway shit they buy every month that you'll see once and never again.
I had the money saved to replace my brand new tires 4 months after I bought them and I'm an uneducated retard with a slave job.
I saved the amount I spent on my used car in the same time I paid the car off, which was 14 months early on a 3 year.

They can't afford the taxes and fees paid up front, a functional down payment and the extra $200 a month to avoid paying 10 grand in interest because they're fucking stupid, not because they don't make enough money.

>>28705503
Can you pay it off early?

>>28705474 (OP)
Stupid people with no umpulse control and access to cheap debt.

>>28705503
I don't understand why you don't just get outside financing? Unless the dealership has some promotional offer, you'd do better. The longer year terms have much higher rates so it's stupid that people choose them. Are they going to roll the loan over and pay even more when they want a new car?

>>28705562
yeah, and I will
>>28705921
see above. and again, apr was at prime, so it's not like I could have swung a lower rate somewhere else. the couple banks I spoke to in advance also only offered 5 year terms, so I'm wondering if it was an overall competitive option, as the dealership used a bank I hadn't gone to. one financial officer actually said that my loan was too low, which is why it was only 5 years (or longer) as an option

>>28705921

Jesus Christ, 8 year terms are a thing now? This country is fucked.

How does that work with cars designed to last 5 years tops?

>>28705921
>The longer year terms have much higher rates so it's stupid that people choose them
Anon, it's because they can't afford the car. They mask this by stretching out the loan term to reduce the monthly payment.
But at the end of the day, they cannot afford the car. It's the same trick that's occurred with mortgages, 15 year vs 30.

Finance always, always leads to higher prices. And the more you rely on finance, the more divorced from reality those prices become.

>>28705551
>yeah i'm a lazy ass high school dropout with no career that works as a box stacker at a store but i am very intelligent, everyone else is a fucking retard

>>28705482
Nailed it, easy and dangerous credit causes an increase in spending power and therefore demand, pushing prices higher. Until people are willing to say "fuck that" it'll continue.

>how did it get this bad?
Monetary expansion naturally causes a parasitic transfer of resources from productive positive sum actors (PSAs), to nonproductive negative sum actors (NSAs), as the ruling elite are NSAs, monetary expansion will always be pushed by the oligarchy as it provides a facile opaque means of parasitism.

> Buy a product with a 15-20 year lifespan
> Want to pay it off in 3 or 4 years instead of 7 to 8
Why?

>>28705482
it’s the subprime mortgage crisis all over again. they’ll give a car loan to anyone and their uncle, who cares of they can actually pay it off.

>>28705474 (OP)
COVID showed that people are desprate to get anything and will do anything to get it. Supply and demand are so lopsided that dealerships and manufacturers just set whatever high price they can think of

>>28706152
>buy product with 3 year warranty
>still making payments on it 4 years after warranty expires
this is a recipe for financial ruin

>>28706152
debt is cancer.

very, very antisemetic thread :/

>>28706169
ask me how i know you're poor

>>28706185
an 84 month auto loan is not a home or business or student loan.

>>28705474 (OP)
Any bank that makes that loan deserves to get defaulted on.

>>28706185
Sure, shoot.
Paying off debt and saving is guaranteeing the lowest possible risk.
Doing the silly financebro shit where you play the spread between the cost of borrowing and prospective return is snatching pennies from in front of a steamroller. You’re one unforeseen event away from complete ruin. But you’re too much of a midwit to realize the peril.
Peak fucking Weimar.

>>28706185
how deep are you in, man?

>>28705474 (OP)
Damn I'm glad my FATHER taught me that if you can't easily buy TWO of the car you're trying to get, you can't afford the one in the first place
Love you Dad! Miss you ol man

>>28706208
>between the cost of borrowing and prospective return is snatching pennies from in front of a steamroller.
Cute analogy. But while you're leaving those pennies on the ground, mine are compounding. I'm three payments away from my last car loan being paid off, at which point I'll have three cars, four trucks and two motorcycles free and clear. Meanwhile I've been maxing my 401k match and/or Roth IRA contributions. I'll have paid just shy o $100 in interest on that last car loan, and my retirement shit appreciated $27k in Q3 not including contributions.
Oh, and I got to drive an aluminum 5.0 fx4 with heated leather and a panoramic moonroof that I bought for $20k during covid, while prices we're going faster than most people could save.

>>28706355
yes yes, its great that you had a father. but how can we teach this lesson to black children before jews use them to crash the economy?

>>28706369
>Shy o $100 in interest on that last car loan,
Shy of $100 in interest on that loan this year*

>>28706369
okay, opportunities to humble brag aside, maybe we're talking about different things?

I was speaking to situations like this:
>you have 15k on hand
>you have a 15k debt with 5% APR
>you could invest that 15k and yield 10%
(these are pretend numbers, midwittery plz go.)
the financebro spoonfed "advice" on YT or tiktok would say
>yeah bro, just invest that 15k and make 5%
it'll take ~14.5 years to break even on that; (72/5)

A LOT of bad things can happen in that time period.

>>28705474 (OP)
zoomers are cooked

>>28706374
>it'll take ~14.5 years to break even on that;
No, you're ahead of day 1.
Option 1: pay debt. Assuming no early payoff fees, you now have nothing ($0 assets, $0 debt)
Option 2: invest. You still have $15k in debt, accumulating Interest. You also have $15k in assets, earning returns. At the end of period 1 you have $15,750 in debt and $16,500 in assets. The debt likely has payments due along the way, simplifying to 5 years of principal repayments and annual interest that's a 3,750 payment year one. Sell some of your asset and you're now at $12k debt and $12,750 of assets, or $750 better off than having paid your debt
>Risk
Valid concern but don't take a loan that stretches you so thin a temporary setback causes problems. Having no debt and no assets can also be problematic when your income dries up or a big surprise expense happens

>>28706369
Different scenarios, anon. Assuming none of that is bullshit, you're one of the people who can finance a vehicle and come out ahead. Most people who finance do so because they can't afford it. The markets have been rolling along nicely for a while but dips, recessions, and depressions happen. If you lose your job, it sounds like you'll be sitting pretty. For a lot of people who took out an auto loan, the loss of their job also means the loss of their car and therefore a big part of their means to get another job. Those people should pay cash and buy a car they can actually afford, not take out an 84-month loan.

>>28706185
Shalom, rabbi!

>>28706397
well, there's a couple of assumptions in your example..
1. the note is for something like a fund that can be partitioned and sold off.
2. the yearly principle/interest payments.. you could have put that into savings had you paid off the loan, couldn't you?
as in:
>you saved and invested the 3750 that you would have otherwise paid during period 1.
>you now have no debt, and 3750 in assets to be invested and compound.

>>28706101
you obviously didnt read that post and wouldn't understand it if you tried

>tfw unemployed, only 12k in the bank, but own a paid off convertible c8
not sure how to feel

>>28705503
Lies.
Lenders don't limit loan terms.

>>28706385
The Zoomers I know worked under the table and bought their cars in cash.
Them all seem very very debt adverse.

Little brain, no discipline plan:
>finance car at 72 months with a monthly payment you can barely make assuming everything in your life goes perfectly for the next 6 years.

Midwit option:
>save up cash and buy car outright because you can't comprehend anything beyond a straight transaction and can't manage money
>(lose purchasing power of your cash through inflation during the time you're saving up $35,000+)

Actually using your brain:
>don't be poor
>have cash
>put down payment on a credit card, get points/cash back
>finance the rest of the deal
>wait a week and pay it all off to screw the bank out of the interest they were expecting

Based option:
>only buy used cars, 2014 or older
>pay in Monero