Used-car salesmen never seem to get caught. Either that, or they persuade the officers trying to arrest them to purchase a vehicle.....
Some of these ‘car dealers’ have a creative business plan.
The down payment covers their car cost. Then they finance the rest. When the customer does not / cannot make payments, they repossess. They get the car back for another round. They do not check credit history because they are in a win/win.
Sometimes the customer knows this will happen, but is willing to pay a premium for a car for a few months until repossessed.
the used car market has been screwed up since 2009, when cash for clunkers destroyed nearly a million cars.
I am now hearing ads for LEASING “certified” used cars. When will the insanity stop?
Does this mean the prices for used cars will drop back down into the “reasonable” range?
“This is the face of the new subprime boom. Mr. Durham is one of millions of Americans with shoddy credit who are easily obtaining auto loans from used-car dealers, including some who fabricate or ignore borrowers’ abilities to repay. The loans often come with terms that take advantage of the most desperate, least financially sophisticated customers....”
He was walking before and now he is walking again. Got to drive for several months with out making a payment. Who’s the victim.
if he knew his situation why did he even consider taking the loan?
moron.
Another problem is that of too many overpriced used cars that develop serious problems after 3 or 4 payments. No such thing as a reliable,low-priced,affordable used car any more in most instances.
The simple fact is that the Fed has extended the Community Reinvestment Act to loans of any type, effectively making it illegal for banks to deny loans to Eric Holder’s people.
Why should it be anyone’s responsibility, other than the buyer’s, to determine if the buyer can afford the purchase (car, house, boat, etc.)?
interest rates, for things like gov’t bonds,
are near zero.
the ‘sub-prime thing’ will be with us forever.
At age 60, he’s got to be drawing Social Security Disability payments rather than retirement benefits.
My 82-year-old father-in-law died recently. After blowing his inheritance on women and crazy investments, he was living on Social Security with barely a penny to his name. Nonetheless, a few months before he died, he got an $18K loan to buy a used Cadillac This article suggests how it could have happened.
And, like subprime mortgages before the financial crisis, many subprime auto loans are bundled into complex bonds and sold as securities by banks to insurance companies, mutual funds and public pension funds — a process that creates ever-greater demand for loans.
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Fraud? YES ,, the bank was desperate to write the loan ,, so they could fulfill their obligation to a CDO house .. so they ignored , encouraged or altered the credit app themselves to make the loan happen... Who is the Victim? Well it’s you and me if anything we have our retirement in bought a piece of the debt.
I recently bought a 11 year Honda Accord (runs like new) with 154,000 miles on it. The price was higher then I thought it should be. I searched and searched but the used car prices are too high (both dealers and private). The dealer said because of my history I was offered a higher interest rate. I put $2,500 down and got a 36 month loan.
My history they referred to is that the last time I bought a car was 1999!! They want someone to basically turn over a new car every few years. Why that would be renting a car.
My credit history was 774 at experian. I figured a low interest rate but it is too high. I will see if I can refinance with another credit union.
The premise of the article is that he's some kind of victim, and that is certainly not the case here.