It reminds me of what happened yesterday when I went to the dealership to get my car serviced. I simply went in to get an oil change and tire rotation and while there, the manager asks if I’d be interested in getting the 2019 model of my vehicle. I told him that I had no interest in such, to which he then told me that they have a program where they’re buying back the older model cars at $5k above blue book value in order to help people get the latest models. I told him that I’m definitely not interested now since I have zero interest in piling up debts, especially when my car is only 4 years old and works just fine. He insisted that the deal they’re offering would be better for me than what I’m presently doing. I agreed to let him run some numbers for me and we’d take it from there. After he ran the numbers, we’re talking monthly car payments of almost $800 per month! On the low end, payments were $650. I have a nearly 800 credit score, so my interest rate wasn’t high. Of course I immediately told the sales team that I have no interest in making a purchase, especially when I presently pay only $200 per month and I’m in the final year of my car note. The sales team spoke as if I were being irrational and told me that I was offered one of the better deals. By the way, this is not some high end car dealership. Hell, it’s Nissan.
I thought to myself...if people are paying that much per month for vehicles, everyday 9-5 people, then it probably won’t be long until a wave of defaults hit the auto market.
