Sign a loan at 25% and then blame the bank for giving you money

[FraserB]

The amount of facepalm here is ridiculous. Apparently the bank "robbed" these people and "made" them sign a contract for a 25% car loan. Over 7 years.

I'd say the lack of common sense about money that led to them signing is the same lack of common sense that got them to the point of bankruptcy in the first place.

http://www.cbc.ca/news/canada/british-columbia/couple-feel-robbed-by-25-interest-td-car-loan-1.2483342

[kertejud2]

They needed a 7 year term on a $21,000 car (a Dodge Avenger just to make matters worse)?

These idiots deserve what they get. Hell if you're getting 0% financing I can see the appeal of a 7 year term when you feel the need to make payments and can't pay a lot down, but holy fuck. These people need to be saved from themselves.

[Twin_Cam_Turbo]

Seriously? There's so many different options they could have taken over that, and they chose that one and now complain?

[corsvette]

I'll bet the salesman and/or business manager told the Couple they could refinance after a year just to ink the deal at 25 points. Fat commission in their pockets now and who the hell cares what happens next year when the people come back to refinance the deal.

Maybe they got seriously mislead, faithfully made payments for a year to re establish credit just to find out the Dealer/Bank lied. :dunno:

[Canucks3322]

You're missing the point though, there are a lot of people our there that are just bad with money...and the banks are preying on them and that's wrong.

[Twin_Cam_Turbo]

Originally posted by Canucks3322
You're missing the point though, there are a lot of people our there that are just bad with money...and the banks are preying on them and that's wrong.

True but the customers need to make a judgement call, it's not like they have a gun to their head at the dealer saying take it or we end your life.

[rage2]

Originally posted by Twin_Cam_Turbo
Seriously? There's so many different options they could have taken over that, and they chose that one and now complain?
There's really not a lot of options for people with terrible credit. These are the loans that they qualify for, and you need to get into these loans to rebuild credit.


Originally posted by corsvette
I'll bet the salesman and/or business manager told the Couple they could refinance after a year just to ink the deal at 25 points. Fat commission in their pockets now and who the hell cares what happens next year when the people come back to refinance the deal.

Maybe they got seriously mislead, faithfully made payments for a year to re establish credit just to find out the Dealer/Bank lied. :dunno:
And that's the thing, happens all the time. Sales ppl say they can refinance later when their credit improves, but what lender would refinance a loan at 25% when there's so much profit? It's all BS, and it's my word against yours when it comes down to it. People need to learn to read the fine print, even if you've got shitty credit to make sure you're not being BS'd.

[max_boost]

Isn't that the going rate for those places that "guarantee approval"?

[Twin_Cam_Turbo]

Originally posted by rage2

There's really not a lot of options for people with terrible credit. These are the loans that they qualify for, and you need to get into these loans to rebuild credit.


And that's the thing, happens all the time. Sales ppl say they can refinance later when their credit improves, but what lender would refinance a loan at 25% when there's so much profit? It's all BS, and it's my word against yours when it comes down to it. People need to learn to read the fine print, even if you've got shitty credit to make sure you're not being BS'd.

Did they really need a $21000 vehicle though? Why couldn't they spend $5000 on a vehicle? Even if it's the same rate, the interest is significantly less, and I'm sure you can get a loan on older/cheaper vehicles as well.

[relyt92]

I've gotta wonder though, a year out of bankruptcy and getting a $22000 car? A lot of those guaranteed approval places I've seen around have cars a lot less than that kind of money.

[sabad66]

Dick move - Sure they signed up for 25% interest but that was under the assumption TD / the dealer kept their promise of refinancining after a year of on-time payments. 30 months later and nothing. I don't know the exact definition but this has to be close to the textbook definition of "predatory lending"

[kertejud2]

Originally posted by Twin_Cam_Turbo


Did they really need a $21000 vehicle though? Why couldn't they spend $5000 on a vehicle? Even if it's the same rate, the interest is significantly less, and I'm sure you can get a loan on older/cheaper vehicles as well.

They could give James Stewart a call :D

[FraserB]

Originally posted by sabad66
Dick move - Sure they signed up for 25% interest but that was under the assumption TD / the dealer kept their promise of refinancining after a year of on-time payments. 30 months later and nothing. I don't know the exact definition but this has to be close to the textbook definition of "predatory lending"

Even the people involved admit that it wasn't a promise. The dealer only said the interest rate COULD be lowered after a year, not that it WOULD.

[quick_scar]

Originally posted by kertejud2


They could give James Stewart a call :D


This

[max_boost]

People need mar to read through all the fine print for them. Where is that guy is he still around.

[A790]

Originally posted by FraserB


Even the people involved admit that it wasn't a promise. The dealer only said the interest rate COULD be lowered after a year, not that it WOULD.
Still deceptive. You know what it's like when you're sitting in the finance office: high pressure, eyes on you waiting for you to sign the dotted line, etc.

As much as I feel for the couple involved, I agree with twin_cam_turbo... do they need a $21,000 car? Why not grab a $10,000 car and pay it down faster and with less interest accrued?

Poor judgement from the couple, poor business practices from the dealer/lender.

[rage2]

That's what happens in these high pressure poor credit sales situations. You get sold on the monthly payments, what they can afford to pay. A typical sales pitch is that a $10k car will cost more in the long run due to maintenance than a newer car at $22k. Lots of sales tricks to get people to buy shit they can't afford. And it works every single time.

[A790]

Originally posted by rage2
That's what happens in these high pressure poor credit sales situations. You get sold on the monthly payments, what they can afford to pay. A typical sales pitch is that a $10k car will cost more in the long run due to maintenance than a newer car at $22k. Lots of sales tricks to get people to buy shit they can't afford. And it works every single time.
True, but at least $10k with 25% interest is cheaper than 21k with 25% interest...

[Maxt]

They probably skipped that C.A.L.M class.

[Stephen81]

Did anyone actually read the article??


“We had to get the car they wanted … we didn’t even get to choose the car that we purchased,” said Hauser, despite their preference for a lower-priced model.

[ZenOps]

No biggie. People in the UK take 5,853% APR loans through Wonga.

Everyone knows what people usually do 15 seconds after they take out that loan *cough* Donald Trump *cough*. I mean really though, thats the way everyone seems to want it, especially those that would vote Trump in for president.

Free money!

[sabad66]

Originally posted by FraserB


Even the people involved admit that it wasn't a promise. The dealer only said the interest rate COULD be lowered after a year, not that it WOULD.
from the article:
"They said Okanagan Chrysler Jeep Dodge sold them a 2010 Dodge Avenger, by promising them if they made their payments faithfully for a year, the dealer would then secure another TD loan, perhaps on a trade-in, at a much lower interest rate."

Nobody here was in the room so we have a he said-she said situation, but anyone who has ever purchased a new car can make a good guess on how that conversation probably went:

dealer: "the car is yours for $xx a month."
couple: "what's this about 25% interest?"
dealer: "oh well since you're bankrupt that's the best we can do. BUTTTT if you make your payments on time come back in about a year and we'll get you a better rate"
couple: "oh that's alright then... we'll be extremely diligent on making the payments and will come talk to you in a year"
dealer:"good stuff. do you want the protection package and diamond master windshield coating? it's only another $16/month"
...


I totally agree with others saying they probably didn't need a brand new car, but the point is that they shouldn't have mislead them into thinking they had a chance. these dealers deal with bankrupt people all the time and knew damn well they weren't going to get a better rate for the couple.

[16hypen3sp]

Haha... reminds me of a good interest story.

I walked into my bank and told them I wanted to pay off the remainder of my loan.
She took my money and transferred it onto my loan. She said it would take about three business days to complete.

So three days later, I am looking at my loan and it reads a balance of 0.
But underneath the balance showed an interest rate of 99,999%... I guess thats the highest possible interest rate their system will take.

Imagine trying to pay that back.


But anyways yah, this couple was crazy for taking on a 25% rate.

[relyt92]

Originally posted by stephen_haxton
Did anyone actually read the article??

I also agree it was really shitty of the dealership to tell them they would be able to get it refinanced to a lower rate if that's what was said, but the couple wasn't forced to use that dealership to get a $20000+ car.

[spikerS]

It is not always someone that is "bad" with money.

I used to always buy my cars in cash, $3-4000. Any repairs, I would fix myself kinda thing.

Decided I wanted something newer and more reliable for when my kid came along.

I went to dealership, and talked it over. Ended up picking a cheap PT cruiser. My financing rate was going to be 29.9%, hence the cheap car. The rate was so high because I had zero credit. Not bad credit, just no credit, which is way worse than bad credit.

The idea was take the load, and get a secured credit card, and pay off both over a year to build up the credit, which I did, then trade in the car for a new one, and a lower rate.

Sucks, but it was what I had to do.

[rage2]

Originally posted by spikers
The idea was take the load... Sucks, but it was what I had to do.

[spikerS]

Originally posted by rage2


sad part is, that quote works...

[Team_Mclaren]

Originally posted by sabad66




I totally agree with others saying they probably didn't need a brand new car, but the point is that they shouldn't have mislead them into thinking they had a chance. these dealers deal with bankrupt people all the time and knew damn well they weren't going to get a better rate for the couple.

Did anyone missed the part where she MISSED OTHER PAYMENTS ( second video, skip to approx 1:30) so she could make the car payments? You know that to refinance, lender also look at your history for OTHER payments too...

It is entirely possible to refinance to a lower rate, but if you continue to fuckup your payments, you're fucked





Originally posted by corsvette
I'll bet the salesman and/or business manager told the Couple they could refinance after a year just to ink the deal at 25 points. Fat commission in their pockets now and who the hell cares what happens next year when the people come back to refinance the deal.

Maybe they got seriously mislead, faithfully made payments for a year to re establish credit just to find out the Dealer/Bank lied. :dunno:

[syb65]

i bet u when she just received the car, she was blogging and bloating to all her friends how she has a new car and that this dealership was the BOMb, telling all the kids that her Avenger was in the Avengers movie and stuff(maybe real story?). And now that all that has worn off and reality has set in, and that she has a shitty car that now needs lots of repairs and nothing to pay it with, she tries to get the community and media to give her sympathy. What a load of shit!~!!
I'm surprised her beauty store is still afloat, i guess she's living the dream. She gets to earn a living doing what she always wanted and driving a new car.

Just in case nobody got it, I feel no sympathy for this dumb broad.

[ZenOps]

But its also wrong to assume that the borrower is not going into the contract with the intention of bankruptcy.

Like the 50-year mortgage where you actually ended up paying less than any renter. Once you declare bankruptcy, you cannot be chased for any owed monies.

So you get to live in a nice house, or drive a nice car - far beyond your means, with the full intention of declaring bankruptcy and forcing the losses on the banks or lender.

Californians do it all the time. Arguably, Donald Trump also lives far beyond his means (was actually several billion dollars in debt, but still lived like a king on other peoples money)

[roopi]

As a TD stock holder I can't complain about this.

[JustinMCS]

No sympathy from me. They declared bankruptcy in 2010 from excessive credit card debt, wonder why the interest is so high a year later when they still have money problems and want to buy a car, agree to the loan and interest, and then bitch about it later. Some people. They need Gale Val-Oxlade, not the media. She will rip them a new one.

[cam_wmh]

Originally posted by spikers
It is not always someone that is "bad" with money.

I used to always buy my cars in cash, $3-4000. Any repairs, I would fix myself kinda thing.

Decided I wanted something newer and more reliable for when my kid came along.

I went to dealership, and talked it over. Ended up picking a cheap PT cruiser. My financing rate was going to be 29.9%, hence the cheap car. The rate was so high because I had zero credit. Not bad credit, just no credit, which is way worse than bad credit.

The idea was take the load, and get a secured credit card, and pay off both over a year to build up the credit, which I did, then trade in the car for a new one, and a lower rate.

Sucks, but it was what I had to do.

Strange.

When I was in Uni, they were throwing credit cards at us.

[RatherBePerfin]

They purchased a vehicle they weren't actually interested in at a price point higher than they were looking to spend with an interest rate higher than they were satisfied with, and it is the bank's fault?

This is just a fine example of the hand holding that is expected in our society these days. Nobody is at fault for their situation, somebody should have steered them in a different direction. Being financially prudent is not that difficult, some people are either too lazy to learn or are more interested in living beyond their means than actually starting at the bottom and truly getting somewhere in life.

[spikerS]

Originally posted by cam_wmh


Strange.

When I was in Uni, they were throwing credit cards at us.

Yeah, I never went that route with a CC. I had one loan when I was 18 for just about a year for a Jeep YJ that my mother co-signed for, after that, I didn't have any credit until I was like 26 or 27.

[you&me]

I'm not feeling any sympathy for the couple.

For one, they had (have?) a history of bad debt control and bankruptcy; what do they expect? Lenders need to manage risk and these people are incredibly risky.

Secondly, the dealer didn't technically lie. There's absolutely nothing stopping the couple from refinancing the car a year into the term, by either going through the dealer or any number of other auto credit sources. That is, except they missed other payments during the term of their auto loan, so likely wouldn't qualify for a better rate anyways.

[ExtraSlow]

These people need a permanent mark on thier credit file that they aren't allowed to apply for credit without a responsible person present.

They are acting like children.

[300zxfairlday]

When i was 22 i went into a few dealerships trying to secure a car loan. All were giving 20%+interest rates! Every once reason was i have no credit. Didnt have a credit card or any previous loans or any bills that report to credit. Went into one of those everyone approved places got a 16% car loan on a 30k vehicle. Was told i could come back and refinance in 1 year year IF my credit improves which it did. Went back in and got it re financed at 6.5%
They must have defaulted on a few other payments that even 30 months in and they cant get a re finance

[Tik-Tok]

"Why would I want to pay $44,000 for a car that's now only worth $15,000?"


"It’s like rich people getting rich off the poor,”


Are these people new to the planet or something? Only in pseudo-socialist B.C. is this a news story, lol.

[Xtrema]

Some people are just stupid with money.

[GTS4tw]

Originally posted by Tik-Tok





Are these people new to the planet or something? Only in pseudo-socialist B.C. is this a news story, lol.

They are getting a lot of sympathy and support locally, the soccer moms are on the warpath! Living beyond your means and owning nothing is a way of life in the Okanagan, our average wage is probably around $12, but everyone has a 50k+ vehicle.

[jwslam]

In Calgary, Nenshi would tell them to get a bike.

[quick_scar]

My dad always stressed how important it was to have good credit and pay off your credit card all the time and never carry a balance. This is one of the best life lessons he could have taught me. The day I turned 18 I called the bank and got my first credit card. Was one of those $1000 secured ones that after making small purchases on every month and paying back in full they give you the $1000 back you used to secure it. Also got a couple $500 limit cards as I was a student and they give those out to anyone.

2.5 years later, done school, working a full time job and I had the credit rating to qualify for a $300K+ mortgage to buy my first place at 20. To this day my credit rating is pretty much the highest I can get it. Always made minimum payments, different types of credit (LOC, Mortgage, CC), Utilities, etc...

It has been a huge boost to my ability to do things I want in life for reasonable cost. All in all, my advise to young adults (assuming you can handle the responsibility) is to start building your credit as soon as you can, and do everything in your power not to screw it up. If you do you will feel the effects for years (as these people are learning).

[suntan]

My first car loan was at 11.9%. I had zero credit history. WTF?

[Antonito]

Originally posted by syb65
i bet u when she just received the car, she was blogging and bloating to all her friends how she has a new car and that this dealership was the BOMb, telling all the kids that her Avenger was in the Avengers movie and stuff(maybe real story?). And now that all that has worn off and reality has set in, and that she has a shitty car that now needs lots of repairs and nothing to pay it with, she tries to get the community and media to give her sympathy. What a load of shit!~!!
I'm surprised her beauty store is still afloat, i guess she's living the dream. She gets to earn a living doing what she always wanted and driving a new car.

Just in case nobody got it, I feel no sympathy for this dumb broad. I too feel no sympathy for the fictitious people in my fantasy land reality. :nut:

A few decades ago we had tighter lending criteria and things still seemed to work ok. We really need to reevaluate at what point a loan is just stupidity. It's not a "socialist" concept, loans are denied all the time. Just move it a little more in the direction of reality. The bank didn't do anything illegal, and that's the problem, they have no imperative to not try to make money off this.

I get that the family thinks that the car will make their lives easier, having a junky car makes getting to work difficult, getting their kids to school or whatever difficult, but now they're stuck, and this loan is just sucking them dry so any possibility of daylight is gone for at least a few more years. They are worse off now. End of story

[busdepot]

Dodge Avenger... $21,000... :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl:

[ExtraSlow]

Originally posted by busdepot
Dodge Avenger... at any price.. :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl:
Fixed that for you.

[JLau]

whose fault is it to have bad credit...they could have also bought a car that was lesser in price

they gotta build their credit back up from somewhere

[revelations]

Originally posted by GTS4tw


They are getting a lot of sympathy and support locally, the soccer moms are on the warpath! Living beyond your means and owning nothing is a way of life in the Okanagan, our average wage is probably around $12, but everyone has a 50k+ vehicle.

What I think is happening there is that the people who are involved in the grow business artificially inflate the perception of income in that region, causing others to make different lifestyle choices.

Make no mistake, its a HUGE business in the interior.

[sexualbanana]

Originally posted by quick_scar
My dad always stressed how important it was to have good credit and pay off your credit card all the time and never carry a balance. This is one of the best life lessons he could have taught me. The day I turned 18 I called the bank and got my first credit card. Was one of those $1000 secured ones that after making small purchases on every month and paying back in full they give you the $1000 back you used to secure it. Also got a couple $500 limit cards as I was a student and they give those out to anyone.


:werd: My parents basically taught me to hate debt, so my general philosphy has been that if I can't afford it outright, I can't afford it. With some exceptions, of course. But I never understood buying TVs and other stuff on payment plans unless it was absolutely needed.



Originally posted by Antonito
I get that the family thinks that the car will make their lives easier, having a junky car makes getting to work difficult, getting their kids to school or whatever difficult, but now they're stuck, and this loan is just sucking them dry so any possibility of daylight is gone for at least a few more years. They are worse off now. End of story

From what I read, they had a junker of a car that crapped out on them so they needed a replacement. The dealership, for whatever reason, said that the financing he's offering was only available for that car only, and they fell for it.

Granted, no one is arguing that this spot was the result of their own doing, but I think the interest rate and the claim of refinancing after a year seems predatory.

[infamous]

Ok, I see both sides of the story. Having worked in the sub prime car industry, you get to choose which poison your customer drives off the lot. And a lot of the time, that car is being brought back within the first year. I had many customers drive onto the lot, shut off their car, leave the keys in the ignition and walk away from the car completely. Its a lose/lose situation for the customer, because the vehicle that they are paying for is going to be worth a lot less than what they are paying for it, not even including the interest. They use black book values and a lot of them (not all) lie about km's and job history and a lot of different things to approve anyone. There is absolutely no question in my mind that when they were buying the car, they got told that the Avenger was their only option, and that in a year they could re-finance on another vehicle with a lower interest rate.

Now, from the customers side of things. You need a vehicle, and you want something that is reliable and not a big pos. As you walk on the lot, and you see the shady salesman, you know that your credit is effed and that there is not a lot of choice for you. You fill out the credit app, and watch as a big grin comes over the face of the greasy bastard sitting across from you. "YOU'VE BEEN APPROVED!" he exclaims! The part that he isn't telling you, and the whole reason behind the smile, is the 33% interest that they can charge. Your mind is going wild, knowing that there is a chance that you can get a car of your dreams! He then takes you back out to the lot, where he shows you two or three vehicles. The first one is a lemon, the second one is ok, and the third one is barely road legal. (is that really a choice?). You take the vehicle out for a drive, and notice that the stereo is missing, and that the trunk smells like some sort of chemical that could possibly be illegal. The car runs though, and as you get back to the lot you finally decide this is the one! The service that you are receiving right now is awesome, as the salesman walks you back into the office to start printing up paperwork. He brings up the subject about insurance, knowing that you probably don't have a whole bunch of years driving experience. Most of these subprime lots have insurance "buddies" who can give you the best deal. The fact that you need full coverage nearly doubles your monthly price including the vehicle. The paperwork is printed, and the salesman assures you over and over that the rate is only for 1 year, and then you can re-finance and lower your rate, and get an even better car. Not knowing the industry, and needing a vehicle because taking the bus sucks, you sign your life over to the finance company. Now is the fun part, having a $600/month car payment and a $500/month insurance payment on a car that is actually worth about $5000 wholesale. Not to mention gas and maintenance, as well as all your other bills/rent/etc.

I knew I had to get out of the subprime industry when I started losing sleep at night knowing that I was screwing people over in order to get my paycheque.

[suntan]

Originally posted by busdepot
Dodge Avenger... $21,000... :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: I had one of these as a rental. Worst car I have ever driven.

[uv1569]

Sub-prime is for people who cant even finance a cheeseburger.. 25% isnt even the worst rate just the standard.. Some companies are 28-32% and they low jack your car so that if you miss a payment they immobilize your car till you pay

[suntan]

Originally posted by infamous
I knew I had to get out of the subprime industry when I started losing sleep at night knowing that I was screwing people over in order to get my paycheque. Why would you feel bad? You're helping them rebuild their credit when no one else will.

[Modelexis]

Originally posted by suntan
You're helping them rebuild their credit when no one else is legally allowed to.

fixed

Reference: peer to peer lending

[revelations]

Originally posted by infamous
I knew I had to get out of the subprime industry when I started losing sleep at night knowing that I was screwing people over in order to get my paycheque.

I know what you mean, years ago I was working for a business (rent to own), renting TV's to subprime people for a "great" deal (no credit check) of only 99$ a month (for a ~300$ 32" Zenith tube TV) - for a 1 year contract - back in the day.

I couldnt do it in the end, but many people dont a) care and b) are born to sell ice to eskimos.

[suntan]

Originally posted by Modelexis


fixed

Reference: peer to peer lending And how much money are you lending out in this manner?

[rage2]

25% is an excellent rate. You want to see insanity, check this out:

http://www.easyhome.ca

Home of the 29.9% + other addons to get that Xbox One that you NEED to have!

http://www.easyhome.ca/electronics/gaming/gaming_xb1_eomicxboxonecore#.UsxVbP53uMN

$19/week for 104 weeks for a $500 console. That's $1976. :rofl:

If you skim through the fine print, $16.03 is the weekly payment, and $2.97 is for the purchase protection. That works out to $1667.12 for the console, and $308.88 for the purchase protection. Oh, add tax to those numbers too, as it's taxable. There's also a $25 fee that's not included in the price for handling. At the end of your payment term, you have to pay to purchase it. Not stated anywhere how much that costs either.

More rich people taking advantage of stupid, errr I mean poor people.

The PS4 is even worse... same money for a $400 console haha.

http://www.easyhome.ca/electronics/gaming/gaming_ps4_eosonps4core#.UsxXiP53uMM

[Sugarphreak]

...

[you&me]

Originally posted by sexualbanana


Granted, no one is arguing that this spot was the result of their own doing, but I think the interest rate and the claim of refinancing after a year seems predatory.

I don't see what's predatory about this. Maybe other than preying on stupid people.

There was absolutely nothing to stop these people from re-financing the car a year into the term. That is, as long as their credit improved. Had they kept their end of the bargain (by making all of their payments and improving their credit), they'd now have a vehicle loan at a more reasonable ~7% and this wouldn't be news. Unfortunately, they continued to be unable to manage their finances and now are stuck with the "I'm a retard with money" rate. Fucking idiots.

[ercchry]

i think im in the wrong business... :rofl:

[roopi]

I see nothing wrong with the service provided by sub prime / easy home. No one is being forced to purchase these items. Take the bus/transit/cab or live with a used kijiji TV or last years Xbox, etc.

These customers are not being charged a high interest rate just for the fact that they have no/bad credit. I'm sure a good percentage of these customers walk away with the goods or miss payments which result in extra costs in collecting, repossession, etc.

[busdepot]

Sub-prime markets are such a vicious cycle. It's easy to point the finger at one party or the other. The loan-sharks know that these guys don't have a chance in hell for a "normal" rate and the smell blood in the water. They know they can rope these guys in, and they do like u/infamous said. People with no or bad credit get the shitty end of the stick, deserving or not. The guys running the shops are in the business of making money, not financial education. Why should they be?

On the other side of it, some of these people don't even know they have a problem and just stick to the "that's life" or "it's just the man is keeping me down". They live in this ignorance not realizing that they're fucking themselves over. Sometimes they just don't even know something is a bad deal and don't have the education to see they're being ripped off. They don't understand the term "living within your means". Or, they're just plain stupid.

I know too that there's a lot of people who do know they have a problem but can't swallow their pride to fix it. They would rather live in denial and keep digging their hole or blame others for their inability to control their spending. They ignore the resources that are available like credit counseling or whatever else that could help show them how to get their lives back on track. They have an addiction to buying.

I'm very thankful I had some good parents that taught me how money works and how to manage it, not to mention bail me out when I goofed. I know a lot of us have made stupid or frivolous decisions with money. The difference is a lot us will know that it was a poor choice and feel like shit over it until its dealt with. Cases like this are a dime a dozen. I'm not sure why this one is making the news. "Loan-shark does job, uneducated buyer makes uneducated purchase decision".

And to anyone reading that is maybe in a similar situation and isn't going to admit it on here (understandably): There are ways to get out of your hole, you just have to have the balls to take that first step and ask for help.

[codetrap]

They indulged in "financial masturbation", and now they have to clean up the mess. Less than zero sympathy.

[asp integra]

Idiots, I see Idiots!

"Why would I want to pay $44,000 for a car that's now only worth $15,000?"

Its a depreciating asset, never finance a depreciating asset! Some people I tell ya!

[roopi]

Originally posted by asp integra

Its a depreciating asset, never finance a depreciating asset! Some people I tell ya!

I will gladly finance a depreciating asset at 1.9% or lower. :thumbsup:

[Modelexis]

Originally posted by suntan
And how much money are you lending out in this manner?
$0

It's illegal in Canada to participate in this service.
That was my point.

I would participate if it were legal in Canada.

[suntan]

Originally posted by Modelexis

$0

It's illegal in Canada to participate in this service.
That was my point.

I would participate if it were legal in Canada. Yeah, I'm sure you only do legal things.

Excuses, excuses. But please, lend your money at 2% to a moron. I'm sure it'll work out well for you.

[Feruk]

Originally posted by uv1569
Some companies are 28-32% and they low jack your car so that if you miss a payment they immobilize your car till you pay
TSX: CFN

Carfinco's the ones that make your car beep like crazy when you miss a payment and immobilize your car if you're X number of days late. These guys have made me some nice returns. Nothing better than making money off idiots like the people in this story. Do I feel bad for them? Not at all. When my parents were poor immigrants, we took the bus for a few years before establishing ourselves. You don't NEED a car.

[Modelexis]

Originally posted by suntan
Yeah, I'm sure you only do legal things.

Excuses, excuses. But please, lend your money at 2% to a moron. I'm sure it'll work out well for you.

I do tons of illegal things, but I haven't found an underground black market peer to peer lending service in Canada yet so I haven't gotten involved.

If you know of a service that operates outside of the public eye send me a PM and I may be interested in getting involved.

I've done some research on services in the US that do peer-peer and you can choose a level of risk for your capital to be used and so I would choose a level of risk that suited my taste. My point was just that such a service would give 'poor people' with low or no credit options outside of major banks and mainstream lending institutions.

Maybe the rate is 20% when the best they could find otherwise would be 25%
It would be relative to what a mainstream lending body could provide. I'm not talking about giving free cash to people with no interest.

[RatherBePerfin]

Originally posted by busdepot
On the other side of it, some of these people don't even know they have a problem and just stick to the "that's life" or "it's just the man is keeping me down". They live in this ignorance not realizing that they're fucking themselves over. Sometimes they just don't even know something is a bad deal and don't have the education to see they're being ripped off. They don't understand the term "living within your means". Or, they're just plain stupid.

I know too that there's a lot of people who do know they have a problem but can't swallow their pride to fix it. They would rather live in denial and keep digging their hole or blame others for their inability to control their spending. They ignore the resources that are available like credit counseling or whatever else that could help show them how to get their lives back on track. They have an addiction to buying.

That is precisely it. There's the ignorant and then there is those unwilling to face the problem. A couple years back I attempted to help a friend/co-worker with his financial issues, and to be honest it felt a little awkward having to do something like that for a person who is almost 10 years older than me. I had to make him realize the mess he made of his life by not having a little concern for his money and rather letting "wants" guide him, and the point was easy to make after I did some math to get a better picture of what his car purchase cost him.

He bought a mid level 2004 SX2.0 in late 2006 at a rate in the 22-24% range (assuming it was supposed to be a 5 year term), and I bought a fully loaded 2004 Silverado early in 2007 at a rate of 6.25% for 5 years. We worked the same job and had similar incomes. He had rent and utility payments and owned very little. I had my truck paid off by the summer of 08, despite having house payments back home and also paying rent in the oilfield. I actually paid the remainder of my house off just before I finished the truck loan. Debt free at 25. Fast forward 2 years and he still owes $5000 on his car, 4 years into owning it. He'd been alternating between missing payments on his car, his heat, power, phone, ect. But there was always money for smokes, his WoW account, and take out every day.

So when it came down to it, the point was pretty simple. His bad decision to buy a little POS car without concern over the interest rate and his lack of attention to his finances ended up costing him in excess of $25k to that point (and more since). My fully loaded truck ended up costing me $29.5k when it was all said and done. Not only did he end up paying more for something substantially less, he also put himself in a position where if he ever wanted another car, it is unlikely he would ever get a better rate and the cycle will continue. For his own good, that car should be the last one he ever buys without doing so from the money in his bank account. I had him on a plan to be debt free in 10 to 14 months. With his income, it was easily do-able with a bit of restraint. He got fired 4 months later, moved home and spent the last couple years doing delivery jobs for a couple dollars over minimum wage. I managed to find him a decent oilfield job in his home town, making over double what he was previously making. I recently asked him if he had his car paid off yet. His answer was "very close". Which means making his minimum payments on his car loan he has spent at least another $8k on it since 2011.

In some ways it is sad that people allow things like this to happen to themselves without caring. At the rate he's going he might be debt free by 40 owning an sx2.0, a 4 year old computer and an x-box 360. My photography equipment likely has a higher value on today's market than all his possessions combined. It is especially scary considering over the past 10 years our incomes have not been all that far apart. Obviously the people in the article have become aware of their problem. The big question is, are they going to do anything about it? Seeing that they've been bankrupt before, I'm guessing they will remain status quo.

[ercchry]

Originally posted by Modelexis


I do tons of illegal things, but I haven't found an underground black market peer to peer lending service in Canada yet so I haven't gotten involved.

If you know of a service that operates outside of the public eye send me a PM and I may be interested in getting involved.

I've done some research on services in the US that do peer-peer and you can choose a level of risk for your capital to be used and so I would choose a level of risk that suited my taste. My point was just that such a service would give 'poor people' with low or no credit options outside of major banks and mainstream lending institutions.

Maybe the rate is 20% when the best they could find otherwise would be 25%
It would be relative to what a mainstream lending body could provide. I'm not talking about giving free cash to people with no interest.

how would an illegal lending network help rebuild credit?

and last i checked thats called loan-sharking... and the rates are much higher than the legal system... and if you dont pay it back? well, your credit score is the least of your worries :rofl:

[Modelexis]

Originally posted by ercchry


how would an illegal lending network help rebuild credit?

and last i checked thats called loan-sharking... and the rates are much higher than the legal system... and if you dont pay it back? well, your credit score is the least of your worries :rofl:

The illegal part was mostly just a joke.

Legal peer-peer lending sites in the US lend at:

Rates from 6.78% to 29.99%* APR. Best APR is available to borrowers with excellent credit.

[CompletelyNumb]

Originally posted by Team_Mclaren


Did anyone missed the part where she MISSED OTHER PAYMENTS ( second video, skip to approx 1:30) so she could make the car payments? You know that to refinance, lender also look at your history for OTHER payments too...

It is entirely possible to refinance to a lower rate, but if you continue to fuckup your payments, you're fucked





Originally posted by 300zxfairlday
Went into one of those everyone approved places got a 16% car loan on a 30k vehicle. Was told i could come back and refinance in 1 year year IF my credit improves which it did. Went back in and got it re financed at 6.5%
They must have defaulted on a few other payments that even 30 months in and they cant get a re finance


:werd:

"You reap what you sow".

Financial education is lacking. It should be an entire course in high school.

[codetrap]

Originally posted by CompletelyNumb

:werd:

"You reap what you sow".

Financial education is lacking. It should be an entire course in high school. Ignorance can be educated, crazy can be medicated, but you can't fix stupid.

[suntan]

Originally posted by Modelexis


I do tons of illegal things, but I haven't found an underground black market peer to peer lending service in Canada yet so I haven't gotten involved.

If you know of a service that operates outside of the public eye send me a PM and I may be interested in getting involved.

I've done some research on services in the US that do peer-peer and you can choose a level of risk for your capital to be used and so I would choose a level of risk that suited my taste. My point was just that such a service would give 'poor people' with low or no credit options outside of major banks and mainstream lending institutions.

Maybe the rate is 20% when the best they could find otherwise would be 25%
It would be relative to what a mainstream lending body could provide. I'm not talking about giving free cash to people with no interest. I don't think you realize the extent of these peoples' ineptitude.

I got a loan back in the 90s for my first car. It was at 11.9%. I had zero credit history. I had a temp job that paid me $12/hr. It took the dealership a few days to find a bank that would loan me the money.

This couple got a loan at 29% in a super-low interest environment. Clearly they have bungled previous loans.

Let's just say that if you did have money to lend to them, you wouldn't be any less merciful to them than the banks.

[Twin_Cam_Turbo]

Originally posted by Sugarphreak
How normal people read:
$19/week for 104 weeks for a $500 console. That's $1976, which is insane!

How poor people read:
$19 bla bla bla bla bla bla bla bla XBOX CONSOLE! That's ba bla bla bla bla bla bla bla bla INSANE!!

This is so true lol!

[16hypen3sp]

Man oh man... some of the rates you guys got are incredible.

My first car loan back in 08 was at 7.00 %. No prior credit at all.
Recession hit and my rate dropped to 6.00% and stayed there until I was done paying for it.

[Modelexis]

Originally posted by suntan
This couple got a loan at 29% in a super-low interest environment. Clearly they have bungled previous loans.

Let's just say that if you did have money to lend to them, you wouldn't be any less merciful to them than the banks.

I think you're probably right about that. This couple is a mess.

[Tik-Tok]

Ricky and Julius probably screwed her credit up.


http://i.cbc.ca/1.2486563.1389129004!/httpImage/image.jpg_gen/derivatives/16x9_620/image.jpg

[blairtruck]

Originally posted by Tik-Tok
Ricky and Julius probably screwed her credit up.


http://i.cbc.ca/1.2486563.1389129004!/httpImage/image.jpg_gen/derivatives/16x9_620/image.jpg

http://static3.wikia.nocookie.net/__cb20090528145523/trailerpark/images/c/c5/Trailer_park_boys_ricky_elvis_do_1.jpg

http://www.ultimateitaly.com/templates/ultimate/images/julius-caesar.jpg

[Redlyne_mr2]

I've done dozens and dozens of car loan contracts with TD, it's full disclosure including a rate that's in bold font and highlighted, total cost of borrowring, selling price of the vehicle etc.. When you've gone through a bankruptcy you have no choice on the rates, the lender holds all the power. You also need a relatively new vehicle as lenders will only lend on specifc model years, it's tougher than you think to get financing for a $10 000 car, they're typically too old so no lender will finance it. That's why the dealer had to tell the customer what car to take.

[J-D]

I feel like the only thing car dealers are usually honest about are the interest rates :rofl:

[NoMoreG35]

Originally posted by J-D
I feel like the only thing car dealers are usually honest about are the interest rates :rofl:

You're wrong my friend ;)

[Black Gts]

I'm convinced this is just part of dealer tactics. I bought a truck in June and it was like pulling teeth to get aprice, they were negotiating using my bi weekly payment amount. I ddon't care about 50 bucks a payment, I want to know the purchase price and I'll decide if I'll pay the payment that comes with it. I bet lots of people end up paying 10k more than the vehicle is worth at 150 b/w for 96 months instead of 155 for 60 months or whatever.

[codetrap]

Originally posted by Black Gts
I'm convinced this is just part of dealer tactics. I bought a truck in June and it was like pulling teeth to get aprice, they were negotiating using my bi weekly payment amount. I ddon't care about 50 bucks a payment, I want to know the purchase price and I'll decide if I'll pay the payment that comes with it. I bet lots of people end up paying 10k more than the vehicle is worth at 150 b/w for 96 months instead of 155 for 60 months or whatever. Then you dealt with the wrong dealer. I bought mine from Josh in Cam Clark Olds, and everything was up front from the beginning. It was too easy to be honest. His first price was better than anyone else, and there were no surprises.

[Black Gts]

I got my price, and it wasn't a shitty car lot I think that maybe they thought I'd have trouble qualifying. I'm just saying it's a tactic that would work.

[ExtraSlow]

I've always found it was easy to negotiate on "real price" and not payments. I always tell them I'm paying cash. Even if I'm not.

I haven't found that to be a hassle. But I'm used to being pretty blunt with people

[Cos]

.

[Tik-Tok]

Originally posted by Black Gts
I got my price, and it wasn't a shitty car lot I think that maybe they thought I'd have trouble qualifying. I'm just saying it's a tactic that would work.

It is, this is a a decade old article, but some of it still holds true.

http://www.milliondollarjourney.com/confessions-of-a-car-salesman.htm

[Toma]

Originally posted by Twin_Cam_Turbo


Did they really need a $21000 vehicle though? Why couldn't they spend $5000 on a vehicle? Even if it's the same rate, the interest is significantly less, and I'm sure you can get a loan on older/cheaper vehicles as well.

Mark up and Savings rate.

Canadian savings rates is currently under 4
%. If you are an average Canadian, making $50k a year, how long to save even $5k? 47% save nothing, and live paycheck to paycheck. Stats seem to point to Albertans having a zero savings rate

These shit holes are crooks (the guaranteed approval places). They sell a $14k pos car for $21k cause of the approval.

And a person that cant afford a car payment on $21k, certainly cant save $5k in cash.

That's why almost NO ONE I know buys cars cash. Everyone buys a $40k car, cause the payments are easy.

Try selling a used car these days lol.

[NoMoreG35]

Originally posted by Toma


Mark up and Savings rate.

Canadian savings rates is currently under 4
%. If you are an average Canadian, making $50k a year, how long to save even $5k? 47% save nothing, and live paycheck to paycheck. Stats seem to point to Albertans having a zero savings rate

These shit holes are crooks (the guaranteed approval places). They sell a $14k pos car for $21k cause of the approval.

And a person that cant afford a car payment on $21k, certainly cant save $5k in cash.

That's why almost NO ONE I know buys cars cash. Everyone buys a $40k car, cause the payments are easy.

Try selling a used car these days lol.

Interesting.. about 1/3 of my customers pay cash.. and I deal with both new and pre-owned..

[btimbit]

Originally posted by NoMoreG35


Interesting.. about 1/3 of my customers pay cash.. and I deal with both new and pre-owned..

Straight cash, or got financing from their bank instead f through the dealer?

[Tik-Tok]

Originally posted by btimbit


Straight cash, or got financing from their bank instead f through the dealer?

My guess is most of them are using heloc's.

[Xtrema]

TD comes out saying that dealers are misrepresenting them on the loans.

Yes you can renew for a lower rate in a year given:

a) your credit improves
b) you buy a new car

[duaner]

Originally posted by Xtrema
TD comes out saying that dealers are misrepresenting them on the loans.

Yes you can renew for a lower rate in a year given:

a) your credit improves
b) you buy a new car
Just came in to post that:

http://news.ca.msn.com/top-stories/car-buyers-say-dealerships-duped-them-over-tds-costly-loans

[Twin_Cam_Turbo]

Originally posted by Toma


Mark up and Savings rate.

Canadian savings rates is currently under 4
%. If you are an average Canadian, making $50k a year, how long to save even $5k? 47% save nothing, and live paycheck to paycheck. Stats seem to point to Albertans having a zero savings rate

These shit holes are crooks (the guaranteed approval places). They sell a $14k pos car for $21k cause of the approval.

And a person that cant afford a car payment on $21k, certainly cant save $5k in cash.

That's why almost NO ONE I know buys cars cash. Everyone buys a $40k car, cause the payments are easy.

Try selling a used car these days lol.

I don't make significantly more than $50k a year but I always manage to save, at least that makes me feel good lol.

[Masked Bandit]

How is any of this news? The only reason TD is getting dragged through the mud here is because a few years ago they bought the number one name in sub-prime financing, VFC. Those guys have been writing deals like this for at least the 14 years I've been in insurance. The standard formula was to take a $5000 car, sell it for $7500 and charge enough interest that the customer pays $15,000 when it's all said & done. I've seen this arrangement hundreds & hundreds of times over the years.

[Toma]

IT's funny how the people with the lowest incomes and standard of living get the worst deal, and get fucked over the most lol.

[muse017]

Originally posted by Twin_Cam_Turbo


I don't make significantly more than $50k a year but I always manage to save, at least that makes me feel good lol.

because you live in your parent's basement?