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Carmageddon: The Economic Crunch Is Forcing A Huge Increase In Repossessions (2/29/24)
Feb 29, 2024 ·
13m 23s
The increase in delinquencies in car payments can be attributed to various economic factors. - Economic Downturns: During periods of economic recession or downturn, many individuals face job losses, reduced...
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The increase in delinquencies in car payments can be attributed to various economic factors.
As th economic reality that comes with a credit crunch continues to make itself known, more and more people are being pressed financially. One of the major industries that is being rocked by this is the car loan industry.
In this episode we dive into the issue and take a look at what's causing so many people to be behind when it comes to their car payments and how there are more reposessions on the books than just about ever before and that the industry itself is lacking when it comes to manpower.
Welcome to Carmageddon of Carmageddon.
(commercial at 9:58)
to contact me:
bobbycapucci@protonmail.com
source:
Millennials Are Losing Their Cars (newsweek.com)
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- Economic Downturns: During periods of economic recession or downturn, many individuals face job losses, reduced income, or financial instability. This can make it difficult for them to keep up with their car payments, leading to delinquencies.
- Rising Cost of Living: The increasing cost of living, including expenses such as housing, healthcare, and education, can put pressure on household budgets. As a result, some people may prioritize other essential expenses over car payments, leading to delinquencies.
- Subprime Lending: The practice of extending loans to borrowers with poor credit histories, known as subprime lending, has become more prevalent in the auto industry. While this allows individuals with low credit scores to purchase cars, it also increases the risk of default and delinquency on car loans.
- Extended Loan Terms: To make car ownership more affordable, lenders have extended loan terms, sometimes up to 84 months or longer. While this lowers monthly payments, it also means borrowers remain in debt for longer periods, increasing the likelihood of delinquencies, especially if their financial situation deteriorates.
- Decrease in Vehicle Resale Value: Cars depreciate over time, and some models depreciate faster than others. If a borrower owes more on their car loan than the vehicle is worth (known as being "underwater" or "upside down" on the loan), they may be more inclined to default on payments, leading to delinquencies.
- Unemployment and Underemployment: High unemployment rates or underemployment can significantly impact individuals' ability to make timely car payments. Without a stable source of income, borrowers may struggle to meet their financial obligations, including car loan payments.
- Lack of Emergency Savings: Many individuals lack sufficient emergency savings to cover unexpected expenses, such as car repairs or medical bills. In the absence of savings, they may resort to missing or delaying car payments, resulting in delinquencies.
As th economic reality that comes with a credit crunch continues to make itself known, more and more people are being pressed financially. One of the major industries that is being rocked by this is the car loan industry.
In this episode we dive into the issue and take a look at what's causing so many people to be behind when it comes to their car payments and how there are more reposessions on the books than just about ever before and that the industry itself is lacking when it comes to manpower.
Welcome to Carmageddon of Carmageddon.
(commercial at 9:58)
to contact me:
bobbycapucci@protonmail.com
source:
Millennials Are Losing Their Cars (newsweek.com)
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