Epic bad financing deal on a car.

[Blackmagic71]

This popped up on my Facebook: guy paid $15,000 over MSRP on a Toyota GR86 and financed it for 7-years at nearly 11%. If it’s true he’ll pay over $20,000 in interest over the life of the loan.

If it’s not a hoax my guess is the probability it gets repossessed within 12-months is darn close to 100%.

[Cdn_Cuda]

In my work we deal with car insurance and sadly see a lot of this. Especially people desperate to get into cars and end up paying stupid high loans, higher than this! I can be really sad to see people taken advantage of.

In this case, more likely someone just bad with money making very poor decisions. Sometimes these cars will mysteriously get “stolen” and burnt/wrecked to try to get out from under the costs… auto fraud is bad, m’kay?

[MrKittyCatMeowFace]

In my work we deal with car insurance and sadly see a lot of this. Especially people desperate to get into cars and end up paying stupid high loans, higher than this! I can be really sad to see people taken advantage of.

In this case, more likely someone just bad with money making very poor decisions. Sometimes these cars will mysteriously get “stolen” and burnt/wrecked to try to get out from under the costs… auto fraud is bad, m’kay?

I heard people would leave their boats or cars in the path of a hurricane so they could collect the insurance when they got flooded. .

[Toestr]

How else is a service member supposed to spend that sweet enlistment bonus 🤑?

[RAZRBAKK]

My girlfriend worked for a sub-prime auto finance company for a short while and it was honestly depressing what people would sign up for. Some rates much higher than 11%, and often for absolute POS cars. I'm talk 15.99%+ for a 10 year old Nissan Rouge, or someone taking a 7 year finance at 29.99% just for the privilege of driving a high mileage luxury car.

Unfortunately no one taught them how it works, or they just don't care.

[Cdn_Cuda]

Yup. Or the people are desperate and have no other options due to bad credit.

[Jordan]

The "extended warranty" for $3k really frenches my fries... they're not worth the paper they're written on.

[cougar20th]

Unfortunately no one taught them how it works, or they just don't care.

That is the problem. A big problem. Unfortunately it isnt always taught in schools. Some people were never taught that. Add the need for a vehicle and its easy to be taken advantage of. Even if the price sounds good the interest rate isn't.

[Chuck E Ducky]

Dealers do this all the time. They guarantee financing to people who can’t afford them or have bad credit. They pay asking and they extend loans out 6-7years to “keep the payments down” then hammer them on the high risk loan rate.

I know a dealer that got rich off selling cars to people who can’t afford them.

[Blackmagic71]

The more I think about this the more it depresses me.

On one hand some slick finance manager was probably taking advantage of this guy, but on the other hand this was a pretty obviously bad deal, and this guy’s two brain cells were too busy racing for third place for him to realize it.

[RAZRBAKK]

A tale as old as time.

[redsquirrel]

I worked with someone that had around a 20% interest rate on an 08 ford focus. Want to say they were about 35k or more into it at the end.

[Tarsun2]

lol
this is all the time. if you watch Caleb Hammer, youll see people with 30% car loans for crap cars...
youll also see people take out high interest loans. were talking about $5k at OVER TWO HUNDRED PERCENT INTEREST; and for things like vacations... its WILD. sometimes theres part of me that wishes i was money dumb, or that i just didnt care. people take out a loan to pay off a maxed out credit card, and then go right back to spending on it just to max it out again.
people on the show say they dont make enough but when he goes over their finances it becomes obvious. they will pay $500 towards the card and spend $800 on that very same card the next day.

[MrKittyCatMeowFace]

.

[Tarsun2]

yeah, idk if that still works. Pre-pandemic you would be able to do this with different things. heck, you could even see if they would take a lump sum @ 50% or even 30%...
now, the price is the price (for the most part) and there is very little room to wiggle.
tried paying a bill with a lump sum at a lesser %. i think it was 70 or 80 % too and they flat out said "No". The only help they offered was a payment plan that would then add interest.
same with student loans, i asked about a lump sum to pay it off. they literally told me a # that was the exact amount left on the loan. lol

they make $ on interest and extending the loan out. And the sob story? these companies have access to things like the LexisNexis reports. they know almost everything about you. What your debts are, what your student loans are, your driving record, your housing record, what loans you have and what debts you have, police reports (if you have any), weather you receive mail or not and where to, and much more. Most of the data acquisition companies advertise 300+ "data points" per person.

these CC companies can put a lean on your house, your car, garnish your wages, and much more.

but yeah, people went crazy with cars... 72 month loans and sometimes, even 96 months. its wild.