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It's pretty easy to repo a car all around the country if you don't pay your bill. Add in the fact that most new cars sell with GPS transmitters built in and man
by kylehotchkiss 10y ago
It's pretty easy to repo a car all around the country if you don't pay your bill. Add in the fact that most new cars sell with GPS transmitters built in and many car loans are provided by the car company themselves and you've got yourself a quick way to recover losses. It's harder for a bank to evict a tenant of a mortgage, harder for a bank to get money from a graduate who is buried in debt, harder for a credit card company to recover from people who aren't paying either.
The funniest thing is how much cheaper new car loans are compared to used car loans.
- rorykoehler 10y agoWhat use is a recovery if liquidating it will get only a fraction of the loan's value back?
- charlesdm 10y agoI'm assuming they don't give you a loan for the entire amount, i.e. just 70% of the value?
- baldeagle 10y agoThrow in a prior car not paid off, paint/tire/oil protection and an additional warranty - it isn't hard to get up to or over 110% of the car's value.
- kylehotchkiss 10y agoIf your credit score is bad, you are probably getting quoted a 15-25% interest rate (my first quoted interest rate was 25% at carmax when I first started working). They can recover depreciation pretty quickly in that case.