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Old 04-09-2013, 11:55 AM
 
19,346 posts, read 17,030,562 times
Reputation: 7519

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Car Loans Grow Longer as Prices Rise - WSJ.com

The average price of a new car is now $31,000, up $3,000 in the past four years. But at the same time, the average monthly car payment edged down, to $460 from $465—the result of longer loan terms and lower interest rates.


What is there to say?

You must now compete with those whose only virtue is the willingness to take on long term debt.
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Old 04-09-2013, 11:58 AM
 
213 posts, read 694,112 times
Reputation: 175
only buy a car with an all cash payment?
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Old 04-09-2013, 12:05 PM
 
Location: Victoria TX
42,661 posts, read 78,757,521 times
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Eight years? Who wants to still be making payments on an 8-year old car? Buy an 8-year old car now, and don't make any payments on it.
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Old 04-09-2013, 12:07 PM
 
1,822 posts, read 4,191,419 times
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Quote:
Originally Posted by starwind View Post
only buy a car with an all cash payment?
That's what i would do. The concept one needs a shiny vacuum cleaner to go to work is an entitlement. If your job does not allow you the ability to afford to buy the vacuum cleaner of your choice in order to get to work it merely means you cannot expect to go to work in that particular vacuum cleaner. Why that realization bruises the ego of the average dope is beyond me...

And before someone gets facetious and tries to suggest there is "wisdom" in financing the vacuum cleaner, let's get it clear that even at zero percent interest, these dopes aren't financing cars to put the untouched liquid into higher interest earning financial vehicles. They are doing specifically and precisely because they live paycheck to paycheck but still believe they should be able to enjoy the luxury of driving a new vaccuum cleaner in spite of their meager income. They're not about to give themselves a lifestyle shave just because the money supply became diluted over 3 decades.
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Old 04-09-2013, 12:10 PM
 
1,822 posts, read 4,191,419 times
Reputation: 4923
Quote:
Originally Posted by jtur88 View Post
Eight years? Who wants to still be making payments on an 8-year old car? Buy an 8-year old car now, and don't make any payments on it.
I know you were joking, but you know it's not about the 8 year old car. It's about driving a new car without having the means to purchase it outright. They also do not intend on keeping the vehicle that long. Someone in the background says "that's a lease!" and they'd be right. But people don't think that way. They don't want mileage restrictions or wear and tear clauses. They just want to feel upper class for a bit, and they'll roll right back into another loan on the replacement car in 4-5 years. That's why they agree to make payments for eight years. They know they'll be making payments for the rest of their lives so eight years is irrelevant.
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Old 04-09-2013, 12:11 PM
 
213 posts, read 694,112 times
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Quote:
Originally Posted by hindsight2020 View Post
That's what i would do. The concept one needs a shiny vacuum cleaner to go to work is an entitlement. If your job does not allow you the ability to afford to buy the vacuum cleaner of your choice in order to get to work it merely means you cannot expect to go to work in that particular vacuum cleaner. Why that realization bruises the ego of the average dope is beyond me...

And before someone gets facetious and tries to suggest there is "wisdom" in financing the vacuum cleaner, let's get it clear that even at zero percent interest, these dopes aren't financing cars to put the untouched liquid into higher interest earning financial vehicles. They are doing specifically and precisely because they live paycheck to paycheck but still believe they should be able to enjoy the luxury of driving a new vaccuum cleaner in spite of their meager income. They're not about to give themselves a lifestyle shave just because the money supply became diluted over 3 decades.
I agree 100%. Worst case i would take a 36 month loan

i dont understand buying the "best". I buy the best for my buck and also doing so while looking for sales.
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Old 04-09-2013, 12:56 PM
 
Location: Boise, ID
8,047 posts, read 25,827,953 times
Reputation: 9391
Look at the history of home loans.

In the early 1900s, home loans were 50% down for 5 years.
In the '30s, the 30 year loan was created, but most people still were getting shorter loans through the 60s.
After that, as interest rates rose, most people moved toward longer loans.
Today, interest rates are low again, but people still stay with the longer loans so they can afford more house than at any point in history before.
I've heard that some companies now offer a 40 year mortgage.

Look at other parts of the world. Japan now has a 100 year mortgage.

As the price of vehicles rises, this will be the trend in automobiles as well.
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Old 04-09-2013, 01:08 PM
 
Location: Colorado Plateau
1,196 posts, read 3,673,356 times
Reputation: 1259
Quote:
Originally Posted by jtur88 View Post
Eight years? Who wants to still be making payments on an 8-year old car? Buy an 8-year old car now, and don't make any payments on it.
A while back I bought a (then) 7yo Subaru Outback for one easy payment of $4200 cash. It had a few issues, some cosmetic; but I've had it for nearly 6 years now and I plan on continuing to drive it for several more years.

Right now someone is driving around in my next used Subaru.
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Old 04-09-2013, 01:14 PM
 
1,822 posts, read 4,191,419 times
Reputation: 4923
Quote:
Originally Posted by Lacerta View Post
Look at the history of home loans.

In the early 1900s, home loans were 50% down for 5 years.
In the '30s, the 30 year loan was created, but most people still were getting shorter loans through the 60s.
After that, as interest rates rose, most people moved toward longer loans.
Today, interest rates are low again, but people still stay with the longer loans so they can afford more house than at any point in history before.
I've heard that some companies now offer a 40 year mortgage.

Look at other parts of the world. Japan now has a 100 year mortgage.

As the price of vehicles rises, this will be the trend in automobiles as well.
Yep. Modern day slavery. The voluntary kind. Scary.
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Old 04-09-2013, 01:20 PM
 
12,637 posts, read 14,851,981 times
Reputation: 18913
Quote:
Originally Posted by gwynedd1 View Post
Car Loans Grow Longer as Prices Rise - WSJ.com
The average price of a new car is now $31,000, up $3,000 in the past four years. But at the same time, the average monthly car payment edged down, to $460 from $465—the result of longer loan terms and lower interest rates.


What is there to say?

You must now compete with those whose only virtue is the willingness to take on long term debt.

and find a car you want to pay for/drive/maintain for 8+ years!
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