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Pay up, fucks!


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2019 Feb 12, 4:12pm   3,271 views  38 comments

by Al_Sharpton_for_President   ➕follow (5)   💰tip   ignore  

A record number of Americans are 90 days behind on their car payments

More than 7 million Americans are at least 90 days behind on their auto loans, according to the New York Fed.

That's higher than the peak in 2010 as the country was still reeling from the devastating financial crisis.

The "number of distressed borrowers suggests that not all Americans have benefited from the strong labor market and warrants continued monitoring and analysis of this sector," Fed economists say.

As auto loan debt has soared, so has the number of people who can't pay, with the level of serious delinquencies breaking past the heights reached just after the financial crisis.

More than 7 million Americans are 90 days or more behind on their vehicle loans as of the end of 2018, according to data released Tuesday by the New York Federal Reserve. That's more than 1 million higher than the peak in 2010 as the country was recovering from its worst downturn since the Great Depression.

"The substantial and growing number of distressed borrowers suggests that not all Americans have benefited from the strong labor market and warrants continued monitoring and analysis of this sector," Fed economists said in a report that accompanied their quarterly look at U.S. consumer debt.

The surge in delinquencies came along with a $584 billion jump in total auto loan debt, the highest increase since the New York Fed began keeping track 19 years ago.

On the bright side, the overall level of overall credit quality actually improved, with those at the lower end of the spectrum declining to 22 percent of the total share while 30 percent of the $1.27 trillion in total auto debt is now held by those on the higher end of the scale.

Those numbers "would suggest that the overall auto loan stock is the highest quality that we have observed since our data began in 2000. However, with growth in auto loan participation, there are now more subprime auto loan borrowers than ever, and thus a larger group of borrowers at high risk of delinquency," the report said.

Debt issued by auto finance companies, rather than at the dealer level, is responsible for most of the growth by less-qualified borrowers. Of the total auto finance debt, 6.5 percent was past due in the fourth quarter.

The flow of debt that slipped into the 90-day past due category edged up to 2.4 percent in 2018, compared with a low of 1.5 percent in 2012.

Overall, household debt rose by $32 billion, or 0.2 percent, to $13.54 trillion in the fourth quarter. That's $869 billion higher than the crisis peak of $12.68 trillion and is 21.4 percent above the post-crisis low point in the second quarter of 2013.

Student loan debt edged higher to $1.46 trillion while credit card balances rose to $870 billion, right around their crisis peak.

Generally, though, Americans were less hungry for debt than in the past: Credit inquiries fell to their lowest level in the history of the Fed survey, driven largely by a decline in refinancing requests.

https://www.cnbc.com/2019/02/12/a-record-number-of-americans-are-90-days-behind-on-their-car-payments.html

Comments 1 - 38 of 38        Search these comments

1   Shaman   2019 Feb 12, 4:28pm  

This is easy to parse:
As car manufacturers raise their prices higher and higher, more people decide to buy cheaper models or just keep driving their older cars longer. This leads to massive unsold inventory.
This is not great for the car companies, so they relax their credit standards for losers and deadbeats, offering them a chance at a loan on an overpriced vehicle. While some, perhaps even most of these people will pay the loans off, as a group they are not a good credit risk. So they default.

And two years later they’re given another loan by the car companies who just need to sell their inventory!

It’s a death spiral.
2   HeadSet   2019 Feb 12, 4:38pm  

so they relax their credit standards for losers and deadbeats

A better plan would be to put those buyers in a cheaper car with a short loan. They come in looking at a $28k Altima, put them in a $16k Kicks or Versa.
3   Tenpoundbass   2019 Feb 12, 4:39pm  

That's not near enough. I propose next years models all start at $40,000 and the premiums should be triple.
Thank God for CFPB, they'll Wachovia Money!
4   BayArea   2019 Feb 12, 5:15pm  

Cash or FUCK YOU!
5   Ceffer   2019 Feb 12, 6:05pm  

Repo my monster truck, I'll have to go back to Granny's 38 year old Corolla. My reputation in shreds!
6   Tenpoundbass   2019 Feb 12, 6:43pm  

willywonka says


That guy had it coming he stole all of the Ketchup packs.
7   Booger   2019 Feb 12, 7:03pm  

Quigley says
And two years later they’re given another loan by the car companies who just need to sell their inventory!


It's mostly banks and financial institutions that are actually dumb enough to make sub prime auto loans, not automakers.
8   Patrick   2019 Feb 12, 7:08pm  

Quigley says
massive unsold inventory.
This is not great for the car companies, so they relax their credit standards for losers and deadbeats


That is also my interpretation.

The auto market is similar to the housing market that way.
9   ForcedTQ   2019 Feb 12, 8:26pm  

Booger says
Quigley says
And two years later they’re given another loan by the car companies who just need to sell their inventory!


It's mostly banks and financial institutions that are actually dumb enough to make sub prime auto loans, not automakers.


And the equally stupid consumers that get into auto loans, especially on New autos! The first 3-5 years of depreciation will fucking kill you. 0% loan, with a payback period and down payment that keeps you on the positive side of equity, then go ahead. If you like throwing money away on depreciation....

Otherwise buy good condition used with cash only! Hold no more than the equivalent of 50% of your annual income in motorized/engine driven vehicles/toys. That way you are building wealth and not over allocating funds into this depreciating asset class.
10   Shaman   2019 Feb 13, 10:42am  

I always buy one year old vehicles with mostly cash or very low interest loans. You save $10-15k off the MSRP and also don’t have to foot the YUUUGE tax bill for initial registration and tags and all the peripherals.
Then pay it off fast.
11   Goran_K   2019 Feb 13, 10:53am  

BayArea says
Cash or FUCK YOU!


Yup. No car payment at all is the best way to go.
12   MrBark   2019 Feb 13, 10:54am  

"The share of auto loan borrowers who were three months behind on their payments peaked at 5.3 percent in late 2010. The share is slightly lower now — 4.5 percent — because the total number of borrowers has risen so much in the past several years."

So, they sold more cars and, surprise, surprise, there is a corresponding increase in the number of people whom are late with their car payments. That's simple math not news. Now if the percentage of late loans was above 5.3% that would be news.
13   Ceffer   2019 Feb 13, 11:08am  

How about lemon socialism for auto lenders. "Lending for Lemons", what could be more appropriate?
14   ForcedTQ   2019 Feb 13, 3:28pm  

ThreeBays says
I'll just drop this here.

Driving 10 year old ICE car
Depreciation $1500
Maintenance $1500
Insurance $1000
Fuel $2000
TCO = $6000 / year

New 2018 LEAF SV w/ tech package
$500 down + 300/month - $2500 CVRP rebate - $800 PGE rebate = $7700 for 3 years, so ~$2600/year
Lease $2600
Maintenance $0
Insurance $1000
Fuel $400
TCO = $4000 / year


So, let's bust up the fuel costs you just "dropped."

ICE car @ 30mpg: $2,000/yr = 20,338.98 miles/yr @ $2.95/gallon 30mpg isn't out of the realm of reality here...

2018 Leaf @ 3.75 m/kWh: $400/yr = 6,976.74 miles/yr @ $0.215/kWh (provided you don't turn on the A/C or heat) Apples to Apples high miles, $1,166.10 fuel cost for the Leaf. Apples to Apples low miles $686.05 fuel cost for the ICE car. So get real, its ICE $2,000/yr vs. EV $1,166.10, or $686.05/yr vs $400/yr.

Maintenance cost on the Leaf is not ZERO. Figure the cost per year wear out for BATTERY DEGRADATION - eventual replacement/tires/shocks/bearings/body and interior upkeep. Willing to bet that $1500/yr on the ICE car is a bit too high as well. You can't say there are zero maintenance costs cause it's a lease unless Nissan agrees to take care of ALL costs that may come up during your lease!

Taking money from other taxpayers/ratepayers to finance your new car just causes taxes and rates to rise, and is fucking THEFT!

Don't be disingenuous.
15   RWSGFY   2019 Feb 13, 5:44pm  

ThreeBays says
Driving 10 year old ICE car
Depreciation $1500
Maintenance $1500


Wut? I have three old cars (aged between 20 and 13 years) and they don't pull $1.5K in maintenance COMBINED (well there might be one year when one of them needed a new clutch and another a timing belt service, but these are once-in-100Kmiles events). Depreciacation has also slowed down to a snail pace once they hit 10-12 years of age (if KBB estimate to be trusted).
16   kt1652   2019 Feb 13, 6:03pm  

ForcedTQ: "Taking money from other taxpayers/ratepayers to finance your new car just causes taxes and rates to rise, and is fucking THEFT"
That is soooo funny. You refuse tax "writeoffs" for mortgage interest, charity, child credit, business expenses, depreciation...based on fairness? Tax laws are unfair, get over it.
If Jeff Bezo takes advantage of his writeoffs, he would be legit and wise.
Don't cry for fossil fuel industry, they got plenty of government subsidies.
17   Booger   2019 Feb 13, 6:43pm  

Hugolas_Madurez says
well there might be one year when one of them needed a new clutch and another a timing belt service, but these are once-in-100Kmiles events)
.

I spent something like $11 for my last timing belt.
18   MrMagic   2019 Feb 13, 6:53pm  

Quigley says
I always buy one year old vehicles with mostly cash or very low interest loans.


I refuse to buy someone else's sloppy seconds and always buy new. I've seen too many people buy a year or two old vehicle and have constant problems. There's a reason why these cars are dumped after a year or so.

I just bought wifey a brand new race car, as a play toy. I want to be the first one to stain the seat, not the previous owner.
19   kt1652   2019 Feb 13, 7:06pm  

Booger says
Hugolas_Madurez says
well there might be one year when one of them needed a new clutch and another a timing belt service, but these are once-in-100Kmiles events)
.

I spent something like $11 for my last timing belt.
And you be right, for youself. I am, or should I say, was D.I.All.Y. Rebuilt engines. But we be the 5% and shrinking.
20   ForcedTQ   2019 Feb 13, 7:34pm  

kt1652 says
ForcedTQ: "Taking money from other taxpayers/ratepayers to finance your new car just causes taxes and rates to rise, and is fucking THEFT"
That is soooo funny. You refuse tax "writeoffs" for mortgage interest, charity, child credit, business expenses, depreciation...based on fairness? Tax laws are unfair, get over it.
If Jeff Bezo takes advantage of his writeoffs, he would be legit and wise.
Don't cry for fossil fuel industry, they got plenty of government subsidies.


I didn't say it was unfair, I said it was FUCKING THEFT! Take a motherfucking class in reading comprehension!

To the point, tax write offs that your owners use as a carrot to get you to do something are Bullshit as well! Wake the fuck up dumbasses! The MID is complete horseshit, yeah, it's a great idea to pay a fuck ton of interest so that you can reduce your tax liability by a smidgen each year. Keep doing that while the banks and lenders rake in a fuckload more in interest than what you see in tax liability reduction. Hey you, you mofo over there, look at this! I spent $10,000 in interest on my home mortgage this year and my fucked up government taxed me $2,000 less because of it! Isn't that genius! I knew I was a smart son of a bitch!
21   kt1652   2019 Feb 13, 8:40pm  

If YOU don't like a tax, it is theft. Otherwise, it is fair. Your turn to be the dictator? When is my turn?
Could you tell me how a tax morphs from unfair to theft status?
Yelling french and throwing a tantrum is entertaining.
22   RWSGFY   2019 Feb 13, 9:12pm  

MrMagic says
Quigley says
I always buy one year old vehicles with mostly cash or very low interest loans.
There's a reason why these cars are dumped after a year or so.


Yes, there is a reason and it is called "lease": most of the 1-3 y.o. cars on dealer lots are lease returns. This is especially true for luxury brands.
23   ForcedTQ   2019 Feb 13, 9:22pm  

kt1652 says
If YOU don't like a tax, it is theft. Otherwise, it is fair. Your turn to be the dictator? When is my turn?
Could you tell me how a tax morphs from unfair to theft status?
Yelling french and throwing a tantrum is entertaining.


Again, reading comprehension. Never said shit about anything being fair/unfair. A credit for buying an electric car or a deduction for paying mortgage interest is not a TAX, but it IS PAYED FOR from Tax Revenue. The government decided to steal money from some and allocate it thusly. It is fucking stupid as hell to goad people into taking on debt or buying a damn car, unless you're trying to control the dumbasses.

Throwing a tantrum huh? Maybe more people sick and fucking tired of our government should try it, instead of getting run over/railroaded....
24   ForcedTQ   2019 Feb 13, 9:36pm  

ThreeBays says
ForcedTQ says
2018 Leaf @ 3.75 m/kWh: $400/yr = 6,976.74 miles/yr @ $0.215/kWh


I factor 10c per kWh, which is what you can get at night with EV rates. $400 / 0.1 * 3.75 = 15000 miles/yr. Let's not mention that many big employers offer free charging.

ForcedTQ says
Taking money from other taxpayers/ratepayers to finance your new car just causes taxes and rates to rise, and is fucking THEFT!


So does billions of subsidies to oil companies and car companies, and write-offs for other shit. I don't really give a crap if you don't like this particular tax benefit.



Where exactly are you taking delivery of electricity? PG&E minimum EV-B rate for off peak is $0.12452/kWh. 12,046 miles/yr, if you limit your charging to 11pm to 7am. You're getting free electricity to charge your vehicle from work? Bully for you!
25   kt1652   2019 Feb 13, 9:47pm  

Forced:
An argument focused on sementics,
If tax revenue is reduced by a tax deduction or credit.. e.g. buying an EV. The assumption is the funds must be made up by increasing the tax for others, there is no magic accounting. Or ideally, the tax burden from the rest can be lowered if this credit was cancelled. Or applied to another more beneficial, purpose.
Who decides that?
If it's a theft, then it is illegal???
Was it unconstitutional?
26   HeadSet   2019 Feb 14, 7:39am  

Booger says
Hugolas_Madurez says
well there might be one year when one of them needed a new clutch and another a timing belt service, but these are once-in-100Kmiles events)
.

I spent something like $11 for my last timing belt.



That's what my junkyard charges, too.
27   MrBark   2019 Feb 14, 3:09pm  

ForcedTQ says
Maintenance cost on the Leaf is not ZERO. Figure the cost per year wear out for BATTERY DEGRADATION - eventual replacement/tires/shocks/bearings/body and interior upkeep. Willing to bet that $1500/yr on the ICE car is a bit too high as well. You can't say there are zero maintenance costs cause it's a lease unless Nissan agrees to take care of ALL costs that may come up during your lease!


Clearly clueless, never owned an electric vehicle. What battery degration? 4 years and 60,000 later I'm still waiting for any sign of "Battery Degradation"

Meanwhile, I spend 30 bucks to drive 1000 miles, never spent a single minute or dollar on service (other than wiper fluid and tires), plug it in at night just like my cell phone, have all the luxury features like LED headlights, leather heated seats etc and accelerate faster than a tuned GTI. I've owned German automobiles that will send you to the poor house on all those costs. Sorry it's so hard to understand.
28   RWSGFY   2019 Feb 14, 4:06pm  

MrBark says
Clearly clueless, never owned an electric vehicle. What battery degration? 4 years and 60,000 later I'm still waiting for any sign of "Battery Degradation"


Which car?
29   B.A.C.A.H.   2019 Feb 14, 4:20pm  

ThreeBays says
Average price of gas in 2018 was over 3.50 as well.


Dude, where are you buying your gas? Are you buying 87 octane or 91? I have been buying in SJ at Arco, Rotten Robbie and World Oil, and occasionally Valero. I keep a logbook of my purchases, I could look up the exact amounts for every purchase going back almost two decades.

Most of 2018 the 87 octane at those stations in SJ was less than $3.50. On Sunday (2/10/2019) paid $2.949 at Arco for 87 octane. I could check but I think the most I paid all of last year for 87 octane was probably $3.399.

91 octane is higher, of course. Yesterday at World Oil was $3.199. Lately World Oil has been 20 cents cheaper than Arco for 91 octane.
30   B.A.C.A.H.   2019 Feb 14, 4:27pm  

Hugolas_Madurez says
Which car?


The 2001 Prius had the battery recalled in spring of 2005 with about 60k miles as those cars had some batteries with cracks. The dealer in SJ inspected and claimed that mine also had the damage. Since it was warranty work I was suspicious about the dealer's conclusion but didn't question it because I was getting a new battery at no charge!

Over the 16 years I owned the 2001 Prius, I'd ask Toyota from time to time what the cost of a replacement battery would be. The answer was the same, for 16 years: $4k installed, with ONE YEAR WARRANTY. So I always had that potential cost in the back of my mind.

Because of the $4k, I asked them, how would I know when I would need to replace the battery? They told me, a deterioration in the gas mileage. But that never happened. When I traded in the car in 2017 it had about 165,000 miles on it, with no deterioration in the gas mileage.
31   B.A.C.A.H.   2019 Feb 14, 4:30pm  

ForcedTQ says

I factor 10c per kWh, which is what you can get at night with EV rates. $400 / 0.1 * 3.75 = 15000 miles/yr. Let's not mention that many big employers offer free charging.


But we must pony up over $2k for the extra meter for the privilege of the EV rate. The big employer is the route to go. We just use the big employer for our plug-in, that covers most of the use. A little bit of gasoline is used, but not much as we're averaging 80 to 120 mpg. (was gettign 65 mpg with no charging).
32   kt1652   2019 Feb 14, 5:17pm  

B.A.C.A.H. says
ForcedTQ says

I factor 10c per kWh, which is what you can get at night with EV rates. $400 / 0.1 * 3.75 = 15000 miles/yr. Let's not mention that many big employers offer free charging.


But we must pony up over $2k for the extra meter for the privilege of the EV rate. The big employer is the route to go. We just use the big employer for our plug-in, that covers most of the use. A little bit of gasoline is used, but not much as we're averaging 80 to 120 mpg. (was gettign 65 mpg with no charging).

Not true.
I did not pay anything to switch to PGE's EV-A, just fill an online form. My night rate $.09/kwh.
EV-B plan requires a 2nd meter dedicate to EV charging.
33   B.A.C.A.H.   2019 Feb 14, 6:00pm  

Hmmm when I was looking into it I found this one.
I forgot, or didn't notice that EV-A was with a single meter.
What is the trade-off?

34   kt1652   2019 Feb 14, 6:11pm  

EV-A: one bill for everything. Fine for me.
See my prior solar/EV/kwh usage graphic.
EV-B: house on 1st meter, EV charge on 2nd meter separated.
Maybe some other thing I don't care.
35   ForcedTQ   2019 Feb 14, 7:13pm  

kt1652 says
B.A.C.A.H. says

But we must pony up over $2k for the extra meter for the privilege of the EV rate. The big employer is the route to go. We just use the big employer for our plug-in, that covers most of the use. A little bit of gasoline is used, but not much as we're averaging 80 to 120 mpg. (was gettign 65 mpg with no charging).



Not true.
I did not pay anything to switch to PGE's EV-A, just fill an online form. My night rate $.09/kwh.
EV-B plan requires a 2nd meter dedicate to EV charging.


As of 1/1/19 EV-A off peak rate is $0.125/kWh Summer and $0.12796/kWh Winter. No, your rate most likely is NOT $0.09/kWh... Might want to check your bill again.

If you can get a charging spot at your employer and it's free, great! That does make the calculation more attractive.
36   ForcedTQ   2019 Feb 14, 7:25pm  

MrBark says
ForcedTQ says
Maintenance cost on the Leaf is not ZERO. Figure the cost per year wear out for BATTERY DEGRADATION - eventual replacement/tires/shocks/bearings/body and interior upkeep. Willing to bet that $1500/yr on the ICE car is a bit too high as well. You can't say there are zero maintenance costs cause it's a lease unless Nissan agrees to take care of ALL costs that may come up during your lease!


Clearly clueless, never owned an electric vehicle. What battery degration? 4 years and 60,000 later I'm still waiting for any sign of "Battery Degradation"

Meanwhile, I spend 30 bucks to drive 1000 miles, never spent a single minute or dollar on service (other than wiper fluid and tires), plug it in at night just like my cell phone, have all the luxury features like LED headlights, leather heated seats etc and accelerate faster than a tuned GTI. I've owned German automobiles that will sen...


You're so fucking awesome and I am so clearly clueless that somebody liked that comment. I haven't owned an electric car, but I do have knowledge of how batteries work. Hopefully in the future total charge cycle expected life will be made inconsequential, but right now that isn't the case. Battery degradation is a fact. You may not notice it, but it should be factored into the calculation for TCO because it is either going to happen while you drive the car, or when you go to sell/trade it in will be factored in based on how much life expectancy it will have left, adjusting the sale price accordingly. Unless you find some fucking moron like me who wouldn't think to negotiate that into the sale price, then you make out like a son of a bitch.

By the way, what car do you own? You wear TSLA kneepads?

It's not hard to understand this stuff, I get it quite well. Cherry picking data during a period of ownership and saying, well fuck, I didn't have to deal with it, while disregarding what will happen to resale price due to depreciation is ridiculous.
37   B.A.C.A.H.   2019 Feb 14, 7:29pm  

Wow! It says, "All told, an estimated 43% of the U.S. adult population owes money on a car". Sheesh.

https://www.fool.com/retirement/2017/05/28/guess-how-many-americans-now-have-auto-loans.aspx
38   kt1652   2019 Feb 14, 8:53pm  

ForcedTQ says
MrBark says
ForcedTQ says
Maintenance cost on the Leaf is not ZERO. Figure the cost per year wear out for BATTERY DEGRADATION - eventual replacement/tires/shocks/bearings/body and interior upkeep. Willing to bet that $1500/yr on the ICE car is a bit too high as well. You can't say there are zero maintenance costs cause it's a lease unless Nissan agrees to take care of ALL costs that may come up during your lease!


Clearly clueless, never owned an electric vehicle. What battery degration? 4 years and 60,000 later I'm still waiting for any sign of "Battery Degradation"

Meanwhile, I spend 30 bucks to drive 1000 miles, never spent a single minute or dollar on service (other than wiper fluid and tires), plug it in at night just like my cell phone, have all the luxury features like LED headlights, leather heated seats etc...

Here is what I actually paid PGE last 12 m billing.

$36.17 ($3.01/month) +
~$10/mnth minimum delivery charges.
Sheesh dipstick. That is charging 10 kwh EV 22000mi/yr+ entire fucken house use. 3000sf 5bd 2stor house in Sacramento valley.
I have solar net metering, my actual rates are much lower than $.09/kwh, more like $0.0036/kwh. (0.3 Cents per kwh)
Btw, still can't answer why the EV tax credit is a theft?
Lol

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