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2016 3500hd Suburban, Fleet only
Rollin Thunder
post Nov 15 2017, 12:45 PM
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QUOTE (carguru @ Nov 13 2017, 11:03 AM) *
I have seen where they are now offering 7 and 8 year finance options on vehicles.....

https://www.trucks.com/2017/09/28/ford-supe...kup-truck-100k/

Needless to say, new vehicle prices have gotten to be nuts.



Which frankly is just retarded. If you need to stretch it out that far you can't afford the vehicle. I did a 48 month loan on the Rolls and even then I usually only do 36 month. After 3 years its obsolete anyway.

But Vehicles are getting expensive, just the way it is, doesn't stop your average middle class family from buying two new Tahoes every 3 years though, maxing out their credit in the process.


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carguru
post Nov 15 2017, 03:55 PM
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I can definitely see where you will at some point owe more than the vehicle is worth--especially with that long of a finance.....


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Gary P
post Nov 16 2017, 05:42 AM
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Good points on the longer length of a loan being nuts. Maybe if you need that many years to handle the loan, you might consider a lease instead? My daughter works in the loan dept of a credit union, and you'd be surprised how often people find themselves upside down on their loans. It's so common now, they even have insurance for that, in case your vehicle gets totaled and your loan balance is more than the value of the vehicle.


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Scott
post Nov 16 2017, 11:10 AM
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Imho, while it might not always make sense not to finance for various reasons, if you don't have the ability to put down a good portion down to at least avoid being upside down the second you take the keys, that's a scary situation.

The last bubble that caused the 07/08 recession was Real Estate. I'm hearing more and more, the cause this time will be these ridiculously long, rubber stamp auto loans that are now the crutch of the auto industry. When that starts going south, it's gonna hurt.


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hdwrench99
post Nov 16 2017, 08:12 PM
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Two words: Gap insurance


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Gary P
post Nov 17 2017, 05:14 AM
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QUOTE (hdwrench99 @ Nov 16 2017, 09:12 PM) *
Two words: Gap insurance

Yep, that's what it's called. I couldn't remember what it was at first, but that's it. My daughter says more an more folks are buying this for their loans from the credit union.


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2012 Summit White Silverado 2500HD 4WD Z71 Crew Cab, New 8/31/12 ... with a Black Bear Performance tune - Love it!
2005 Summit White Tahoe 4WD Z71 (For the wife.... finally!)

2002 Silverado 1500 LS, Ext cab, 4WD...Gone, but not forgotten.... SOLD 8/31/12

How to Donate to Z71T-S.com ==>
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hdwrench99
post Nov 17 2017, 10:36 AM
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We just bought a new (to us) 2015 Wrangler. Even though I put $6,000 down, I still purchased Gap Insurance.


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Black '04 Tahoe keys and 1" spacers 285/70-17 BFG AT KO's Goodyear Duratracs
Black Bear Tune and E-Fans. GMT900 brake upgrade. My Garage



QUOTE
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QUOTE (JimB204 @ Apr 27 2012, 10:10 PM) *
Now that you found this site, you will never be content with your truck..


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Scott
post Nov 17 2017, 01:16 PM
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The problem is, the type of folks looking to purchase a vehicle way beyond their means with these absurd loans, are the same people who go with the most basic cut rate insurance policies they could find. Imho, if the creditors forced Gap that would be one thing, but they don't.

Same with the housing bubble, people with questionable credit - often subprime, were offered adjustable loans with high upside increases, and were approved at amounts way beyond the reasonable income ratio. We all know how that worked out.


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Rollin Thunder
post Nov 17 2017, 08:02 PM
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Banks for cars seem to be lending it likes its going out of style, and I hear stories of people getting 5-6-8% and beyond interest rates and I think geez almost credit card territory there and thats unsecured. My highest auto loan rate has been 2.99% and even then I thought it was high and refi'd a month later for 1.89 at USAA. Between that and student loans I think in the next few years were looking at another crazy crash. The difference is, unlike with houses, student loans have no collateral to collect on and the cars are all loaned out sometimes 50% higher than their worth.

When Buying a car I like to do minimum 20% down and no longer than 36-48 months. Just because for most cars that keeps it new enough to have positive equity and still some factory warranty, and often times thats the best interest rate (often 0%), then trade it in when its paid off, use that as a down payment on the next vehicle, wash, rinse, repeat.

QUOTE (Gary P @ Nov 16 2017, 06:42 AM) *
Good points on the longer length of a loan being nuts. Maybe if you need that many years to handle the loan, you might consider a lease instead? My daughter works in the loan dept of a credit union, and you'd be surprised how often people find themselves upside down on their loans. It's so common now, they even have insurance for that, in case your vehicle gets totaled and your loan balance is more than the value of the vehicle.


Gap insurance has been around a while and I take it when offered just to be safe. Sometimes insurance companies will screw you and offer you less than the car is worth and less than you owe. I know I'm upside down on my Mercedes lease, I think its worth 65-70k but if I were to buy out the lease I would have to pay almost 90k, now thats a lease not a loan so I don't worry about it too much. I give the car back to Mercedes next July anyway and walk away, but if it were totaled before then without gap I would be screwed.

This post has been edited by Rollin Thunder: Nov 17 2017, 08:03 PM


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