The subprime auto loan crisis?

**Averageman** · 07-18-17, 05:52

There is an amazing glut of nearly new used cars and trucks here, I assumed that they were coming back to the dealership.
Thanks for educating me on that.

**Pilot1** · 07-18-17, 07:19

Cars are a lot more liquid, and disposable than homes. However, I see A LOT of $100K cars around her. A LOT. I can't imagine paying that kind of money for a car, and I suspect many don't care about the sticker. Like others have said, many just buy on monthly payment. WRONG. Dealers just want to sell cars any way they can.

**FromMyColdDeadHand** · 07-18-17, 08:32

Originally Posted by glocktogo

I just think new car prices are insane. I got a new 4X4 Tahoe at work this year. It's pretty nice and I thought maybe I should get one to replace my 02 4Runner to tow the boat with. The msrp on a base model 4X4 LS is $51,510. That's the cheapest 4X4 Tahoe you can get? Yeah, call me when they're willing to take about $12K off that. BTW, a Premier before adding any options is $66K, for a Chevy SUV. No thanks.

GM SUVs are crazy, especially the Full Size Tahoe/Suburban/Escalades. Especially if you get anything worthwhile on them, The only thing crazier than their sticker prices is the resale after a couple of years being so low. I buy 2-3 year old Escalades from elderly drivers with low miles. Near half price isn't a stretch. It's funny how big American SUVs don't really get that much scrutiny, but a $70-100 foreign car does. Interestingly, here in CO, the families that are going up and down the mountain most weekends for skiing pretty much have Suburbans- and they run them 5-7 years.

**Arik** · 07-18-17, 09:02

Originally Posted by Averageman

There is an amazing glut of nearly new used cars and trucks here, I assumed that they were coming back to the dealership.
Thanks for educating me on that.

What your seeing is off lease cars bought at auctions. A certain percentage are clean trade ins that the dealer kept. Most money to be made on cars are on used cars. Everyone knows the sticker price of new cars and you know you can bargain a little. Used cars is where the money is at. You don't know how much the dealer payed and while you may have slightly more room to negotiate the dealer can make a killing.

Example
I drive a 2010 Corolla. It was my sister's lease. At the end of the lease she had the option to buy it out. She didn't want to but i did since my car was dying (300k miles... transmission starting to slip...not worth fixing). The buy out for a 4 year old car with 26k miles was $12,500. While waiting I walked the lot and they had a 2001 Corolla with a 100k for $12,000. That's $500 less then my car, 9 years older and 75k more miles. They'll sell it cheaper if you negotiate. Maybe knock off $2 or $3 K if you have cash in hand but they probably paid $2 or $3k to begin with. However if you have bad credit and financing that car expect your final price......when all is said and done to be around $20k or more

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**TAZ** · 07-18-17, 09:11

I have run my last 3 cars (between wife and I) to 10 years. Would have run them longer, but the maintenance costs were mounting, so they had to go.

Prices for cars are set by factory cost, AND what the market will bare. With people being stupid about payments and banks being stupid about lending that second part of the equation gets skewed pretty harshly. This is why folks get hosed paying $50k for an SUV worth maybe $30K at best.

**JusticeM4** · 07-18-17, 09:29

Originally Posted by glocktogo

I just think new car prices are insane. I got a new 4X4 Tahoe at work this year. It's pretty nice and I thought maybe I should get one to replace my 02 4Runner to tow the boat with. The msrp on a base model 4X4 LS is $51,510. That's the cheapest 4X4 Tahoe you can get? Yeah, call me when they're willing to take about $12K off that. BTW, a Premier before adding any options is $66K, for a Chevy SUV. No thanks.

Yes it is ridiculous these days. SUVS/Trucks costing up to $60k for the premium line. When you can buy a lightly used truck (Tundra, F150, etc) for less than half that.

When did vehicles get so expensive? Its a terrible investment (if that even makes sense). Put your $60k on this asset and it will be worth 50% in 4years!! Suckers...

Originally Posted by 26 Inf

Question for the car sales guys: My buddy recently bought a dodge ram, loaded, with less than 10,000 miles on it. Someone knew he was looking and told him when the guy traded it in.

Story was that every 4 months this guy trades trucks at this dealership. Is there anyway that works without losing your rear?

Friend of mine does this with VW's because he's obsessed with them. He buys a certain model then a few months later trades it in for a nicer model. He must've done this like 3 times in one year. He is upside down on his payments but doesn't really care. He owns like 4 VW vehicles in his family. The dealer must love him...

**Scrubber3** · 07-18-17, 09:59

Originally Posted by Arik

People being lent money without income verification.....

I never got asked for income verification for the last two vehicles I purchased. My credit is decent though...

**26 Inf** · 07-18-17, 11:37

Originally Posted by JusticeM4

Friend of mine does this with VW's because he's obsessed with them. He buys a certain model then a few months later trades it in for a nicer model. He must've done this like 3 times in one year. He is upside down on his payments but doesn't really care. He owns like 4 VW vehicles in his family. The dealer must love him...

I'll be seeing my friend after our group's summer hiatus is over and see if I can get to the bottom.

My grandfather liked driving new cars, so bought a new one every year. He'd been going to the same local dealership for years, originally buying from a friend, then the salesman his friend handed him off to when the friend retired. Every now and again they would call him and ask if he was ready to trade as they had someone looking for a truck like he was currently driving. Granddad was shrewd enough I don't think he was getting boned. I figured the salesman was getting base commission selling him the new truck as cheap as he could and then making he real money on the used truck sale.