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How can you honestly "charge off" a debt as unlikely to be repaid, when you are quite likely to be repaid? It seems that in the case of a car loan you can usual
by Y_Y 5y ago
How can you honestly "charge off" a debt as unlikely to be repaid, when you are quite likely to be repaid? It seems that in the case of a car loan you can usually reposses the collateral, which recently will have held value oreven appreciated in the interim.
- kevstev 5y agoHistorically, car values underwent significant depreciation over time and loans that went delinquent were for vehicles that were "underwater"- their value was less than the loan. Its pretty much unprecedented for the value of a vehicle to actually increase at any point in time over its life, and how long this anomaly will go on for is very uncertain- another way to put it is that you don't change all of your process and accounting norms because of a temporary (at least as we think for now) supply issue.
- Y_Y 5y ago> you don't change all of your process and accounting norms because of a temporary (at least as we think for now) supply issue Is this why some people stick insist on making payments by sending cheques through the post?
- eru 5y ago> [...] you don't change all of your process and accounting norms because of a temporary (at least as we think for now) supply issue. Yes. And for the appreciation to persist, the supply chain issue wouldn't just have to persist, but get worse. Current prices reflect expected supply chain issues. That's both prices for new and used cars.