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Old 12-31-2008, 02:44 PM
 
339 posts, read 1,404,145 times
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Quote:
Originally Posted by bentlebee View Post
I saw it yesterday on the business channel....why are people so stupid..just to show off to their friends and neighbors?
I really think it is a toss up between showing off and being financially ignorant. I would throw lack of critical thinking in the mix as well since we are a society so over run by advertising and pseudo reality shows.
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Old 12-31-2008, 03:15 PM
 
Location: mass
2,905 posts, read 6,703,935 times
Reputation: 4984
Quote:
Originally Posted by Marlow View Post
What continually surprises me these days is that people are surprised by the basic rules of financing. Since when is it news that you can be sued for money you owe? How is it that people are completely and utterly clueless about the basics of financing purchases? I understand that some people can be bamboozled by fast-talking sales people, but absent fraud on the part of the seller, a car financing agreement is fairly clear. The numbers are laid out in the documents and the liabilities are spelled out.

I'll stop ranting now.
I really don't have any experience with anything being repossessed, but I have not heard of this suing the person for the balance on car or home loans after the repossessed or foreclosed on item is sold. Either I didn't read the financing agreement, or it wasn't in there to start with.

It is totally logical that if the bank loses money on an auto, they will go back to the borrower for the remainder.

But this should be made CLEAR to the borrower that this will occur if they default on the loan and the car is repossessed, I for one have never heard of it. I thought they just took the car from these people and that's it.

My problem here, is that they repossess the car, then sell it for dirt cheap, much less than it's value, then hand the original borrower the remainder of the bill. They could literally sell a car for $1 and hand the borrower the bill for the other $19,999. That is unfair. They should be required to sell it for at a minimum a certain percentage of it's worth.

I have a feeling these borrowers weren't expecting this to happen. If the were aware this was going to happen, it would give them the chance to sell the vehicle on their own for a reasonable price, pay the remainder and be clear with the bank, or make them less likely to lose the car in the first place. They might make more of an effort to get the payment paid.

Quote:
Originally Posted by car54 View Post
How about the 72 month car loans (SIX YEARS!!) that are becoming popular now that car leasing is no more. (That long loan brings payments down to about what lease payments were)

Folks are upside down for 4 or 5 years with those loans!

If the car is totaled...the insurance payoff doesn't cover the outstanding loan balance, and you OWE. Same if it is stolen, and not recovered.

CRAZY!
Gap insurance should be required. On any car loan.

Quote:
Originally Posted by jaindow View Post
I really think it is a toss up between showing off and being financially ignorant. I would throw lack of critical thinking in the mix as well since we are a society so over run by advertising and pseudo reality shows.
I go for a combination of both, leaning toward financially ignorant though. They usually have no idea how much they will have paid in interest by the end of the loan. Plus they are just looking for the magic number, the one that will fit into their budget at the time, not the total outlay in the long run. If people considered the price of the car including financing from the get-go, they would probably make much better decisions, but you never know how much the financing is going to cost you till you get into that little room, unless you get yourself your own loan before going in, but I don't think most people do that. The dealer does everything for them, and they just sign away.

I like that, lack of critical thinking! I blame the car salesmen/dealerships, too, though, they try to give you as little time to think as possible. Plus you can't get the sale details from them until you've been there an hour or more, so it is very aggravating for people.

P.S. what happened to leasing? My brother just leased a car a couple months ago.
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Old 12-31-2008, 03:19 PM
 
706 posts, read 1,187,523 times
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Not to sound cold, but why wouldn't a lender sue to recover his investment? If you borrow xxxx, you have responsibility to repay xxxx, not a portion of it.
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Old 12-31-2008, 03:24 PM
 
26,662 posts, read 40,639,785 times
Reputation: 14765
Quote:
Originally Posted by SuSuSushi View Post
That's why a savvy borrower will carry gap insurance.
I remember that one of my friends once bought a brand new car but couldn't afford the what is called all risk insurance (in Europe) which covers everything in case of an accident so she chose to go with the limited insurance which only covers everything to the other party involved in an accident when it is fault of the person carrying this insurance and their own car in case of fault won't be covered. 9 out 10 new car owners will have the all risk, but the 1 person who want to buy a new car but has not much money left will go with the limited one. Well she totalled her car and it was her fault and it was within weeks after buying her brand new car and for years she had to pay off the car loan.....
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Old 12-31-2008, 06:03 PM
 
4,711 posts, read 11,178,235 times
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Quote:
Originally Posted by SuSuSushi View Post
That's why a savvy borrower will carry gap insurance.

A savvy borrower would realize they can't afford the car if it required a loan term of that length!
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Old 01-01-2009, 06:18 AM
 
26,662 posts, read 40,639,785 times
Reputation: 14765
QUOTE=mommytotwo;6780059]I really don't have any experience with anything being repossessed, but I have not heard of this suing the person for the balance on car or home loans after the repossessed or foreclosed on item is sold. Either I didn't read the financing agreement, or it wasn't in there to start with.
It is totally logical that if the bank loses money on an auto, they will go back to the borrower for the remainder.
But this should be made CLEAR to the borrower that this will occur if they default on the loan and the car is repossessed, I for one have never heard of it. I thought they just took the car from these people and that's it.

My problem here, is that they repossess the car, then sell it for dirt cheap, much less than it's value, then hand the original borrower the remainder of the bill. They could literally sell a car for $1 and hand the borrower the bill for the other $19,999. That is unfair. They should be required to sell it for at a minimum a certain percentage of it's worth.

I have a feeling these borrowers weren't expecting this to happen. If the were aware this was going to happen, it would give them the chance to sell the vehicle on their own for a reasonable price, pay the remainder and be clear with the bank, or make them less likely to lose the car in the first place. They might make more of an effort to get the payment paid.




Gap insurance should be required. On any car loan.



I go for a combination of both, leaning toward financially ignorant though. They usually have no idea how much they will have paid in interest by the end of the loan. Plus they are just looking for the magic number, the one that will fit into their budget at the time, not the total outlay in the long run. If people considered the price of the car including financing from the get-go, they would probably make much better decisions, but you never know how much the financing is going to cost you till you get into that little room, unless you get yourself your own loan before going in, but I don't think most people do that. The dealer does everything for them, and they just sign away.

I like that, lack of critical thinking! I blame the car salesmen/dealerships, too, though, they try to give you as little time to think as possible. Plus you can't get the sale details from them until you've been there an hour or more, so it is very aggravating for people.

P.S. what happened to leasing? My brother just leased a car a couple months ago.[/quote]

I put the part in red which is the part that you as well as the people who default are wrong about. It is probable in the small print, but the people who buy and can't afford it, never read it, and only whine if they have to pay for what they signed...same is which HOA's, mortgages, etc....

Basically it is similar for everything you buy with a loan...if you don't get sued you are lucky, not the other way around...you sign to agree to pay back!

I understand you never had to deal with it and neither have I, but I understand that every one is responsible for what they sign...if you think a car sales man is so fast and is pushing you, than leave and/or wait till you can think it over or go some place else.

In almost every store they still ask you if you want their store credit card to save immediately 10% that one time...if you take it you are responsible for all the payments....simple as that! You don't have to say "yes" and I know it is annoying that they keep asking, but that is the way it is.
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Old 01-01-2009, 07:14 AM
 
706 posts, read 1,187,523 times
Reputation: 438
I asked a friend in the banking business about this idea that banks just "dump" the cars for low prices and sue you for the difference. He said they are not equipped to be in the car sales business so they generally wholesale the vehicle. It would make sense that they don't devote a lot of time to selling cars. The bank would be much happier and better off if the loan was paid off by the borrower.

Everyone runs into hard times but in the case of repos, it doesn't make sense to blame the bank. A little personal responsibility would go a long way in this country.
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Old 01-01-2009, 08:44 AM
 
26,662 posts, read 40,639,785 times
Reputation: 14765
Quote:
Originally Posted by jimmyP View Post
I asked a friend in the banking business about this idea that banks just "dump" the cars for low prices and sue you for the difference. He said they are not equipped to be in the car sales business so they generally wholesale the vehicle. It would make sense that they don't devote a lot of time to selling cars. The bank would be much happier and better off if the loan was paid off by the borrower.

Everyone runs into hard times but in the case of repos, it doesn't make sense to blame the bank. A little personal responsibility would go a long way in this country.
I agree with you, why blame the car sales man or the bank if the customer doesn't keep up to what he agreed on that is to pay the loan he signed....

People should be thumbs instead of fingers! (a thumb points to himself for the blame, a finger points to others to blame them.)
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Old 01-01-2009, 09:32 AM
 
48,509 posts, read 86,165,150 times
Reputation: 18105
It also happens that peole lose their jobs and such ;but could easily afforsd the car otherwise. Inthese days many are also deciding on whether between house and car payments inthsoe situations. not many are just showing offf altho that is often the preception of thoise who can't afford a new vehicle. Happens just as often to used car buyers or maybe more often since many are in much lower paying jobs and live week to week.
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Old 09-10-2012, 07:12 PM
 
Location: Old Town Alexandria
14,495 posts, read 24,248,912 times
Reputation: 8847
This thread is now officially 5 stars for irony.

Car companies now complaining no ones buying.


lmfao.

And OP, you are a slum landlord in Florida, its rather libelous for you to post issues with your tenants on here...
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