
Americans are struggling to pay off their auto loans - prostoalex
http://nypost.com/2017/02/16/americans-are-struggling-to-pay-off-their-auto-loans/
======
outericky
Americans are also foolishly suckered into believing they need a new car every
few years. It's not a phone. A car should last 10 years and there is
absolutely no reason to buy new unless you have money to burn.

My truck is going on 10 years old (bought used) and has low mileage < 100k.
Paid a fraction of the cost of a new one (roughly 35% of the sticker price
when it was 5 years old).

~~~
chrisper
Unless, of course, people want newer engines that are more efficient, want
newest technology (carplay / android auto), and want newest safety equipment.

At this point it's maybe not so much that they _need_ one, but that they
_want_ one. I for sure don't want to keep cars forever.

Maybe I misread your comment, but keeping a car for 10 years may not be for
everyone.

~~~
thatcat
>newer more efficient engines

Losing a bunch of money as depreciation for a marginally more efficient car
doesn't really make accounting sense.

>android auto /carplay

These are accessories that car manufactures generally do a worse job of
producing than 3rd parties.

~~~
nunez
Some cars are very difficult to retrofit. My 2012 Accord simply _cannot_ get a
CarPlay-compatible head unit without redoing the entire dashboard. That's a
multi-thousand dollar job that also compromises safety (airbag placement). Not
worth it for a minor feature (though I do really like CarPlay).

Same deal for my 14 Ram 1500. Fortunately, UConnect is pretty decent as it is.

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aphextron
>"The average monthly car payment in the fourth quarter rose above $500 for
the first time"

I literally cannot imagine paying $500 a month for a car payment, even as a
young single person making $100k. People are insane.

~~~
cema

      I literally cannot imagine paying $500 a month for a car payment
    

Why not? Consider: I got a Subaru Forester with $0 down and 0% interest which
I pay off over 4 years. With options, it's $650 monthly. Again, no upfront
costs.

~~~
aphextron
To each his own I guess. I'd rather just write a check for $5k and get a
decent used car than worry about making a payment every month for 4 years.

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perryh2
Based on my experience working at drivemotors.com, many people with low credit
are totally fine with entering into loan agreements with very high interest
(9-12%) for 72 months or longer with little to no down payment.

~~~
ZoeZoeBee
The instant gratification nature of a large portion of our society drives them
to recklessly undertake high interest loans on depreciating assets like cars
and furniture from places such as Rent A Center, pay day loans, etc. Seems
there are quite a few ways to keep the poor, poor.

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pcurve
"The average monthly car payment in the fourth quarter rose above $500 for the
first time"

That's frightening.

And if anyone is wondering about the duration,

"Average term for an auto loan: 68 months — this is the longest average term
ever seen by Experian."

[http://www.cnbc.com/2016/06/02/us-borrowers-are-paying-
more-...](http://www.cnbc.com/2016/06/02/us-borrowers-are-paying-more-and-for-
longer-on-their-auto-loans.html)

No wonder people are driving their cars for 12 years+ now. They can't afford
not to.

------
known
797 vehicles per 1000 people
[https://en.wikipedia.org/wiki/List_of_countries_by_vehicles_...](https://en.wikipedia.org/wiki/List_of_countries_by_vehicles_per_capita)

~~~
taxicabjesus
> 797 vehicles per 1000 people

Some people have more vehicles than they need.

My father has three old cars: a 2001 truck (to haul gravel/etc), a ... 1997
Nissan Pathfinder (4wd needed for 4 months/year), and the 1998 civic my
passenger gave me in trade [1] (so he doesn't have to put miles on his truck,
and to save at the gas pump).

[1] [http://www.taxiwars.org/2016/09/the-perpetual-quest-for-
dece...](http://www.taxiwars.org/2016/09/the-perpetual-quest-for-decent-
fares.html)

He could easily buy a new car, but doesn't see the point of dropping all that
money on a depreciating asset. Maybe when he retires...

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toodlebunions
Those Americans are struggling if they're struggling to pay a car loan

~~~
djrogers
No, they're mostly making bad decisions. Taking a loan with an average of
$500/mo for 68 mo (yes, those are the current averages) on a hunk of metal
that's losing value wether you drive it or not? If you're struggling with
that, it's not income inequality or evil banks - it's bad decisions.

------
iask
On top of this is insurance. If you live in NYC it's like paying for a second
car.

