We are long-time Carmax customers. On our last purchase, we were the only customers in the showroom not financing, and a young woman was crying because she couldn't get financed. None of those people could truly afford the vehicles that they were purchasing. No matter how many laws you pass, which always have unintended consequences, trying to keep fools and unethical businesses apart is a fool's pursuit (not referring to Carmax). The key is education. We so terribly need to include personal finance education in our HS curriculums.
Ah yes, the arrogance of the wealthy. Automobile transportation is getting more expensive and wages are stagnant. People are having a tough time affording housing, autos etc. Since you call these people, "fools", you deserve to be called an arrogant snob. I suggest, as I have done, help people, who are responsible, finance autos. God bless.
@@Goodkidjr43 I wasn't referring to all borrowers. I financed vehicles before I learned how badly it was robbing my future wealth. I hope that you didn't vote for the mess of the last four years.
@@Goodkidjr43 they are fools simply by trying to buy an overpriced Carmax car. Also, there are these things called beaters. You buy an older, known to be reliable model, that looks like hell but is in decent mechanical shape. Yes, it takes research and due dillegance, but if you are broke, that's what you do. You do NOT go to a Carmax with their inflated prices just because it is "easy" then complain you can't get financed. That is foolish.
I financed my last car at under 1% interest rate, while being able to keep the money I would have paid upfront invested and earning far more than that. How exactly is that foolish?
I work with a bunch of people who don't know how to manage money. They all have loans on cars that they can't afford. Their cars are always breaking down. They're always calling in sick to work, or showing up late, or coming in smelling like booze or weed from their partying the night before. You can't fix these people. You could wipe out all their debt, and give them a new car, and 6 months later they'd be back in their same positions. Predatory lenders are only part of the problem.
I was an internal auditor for a major bill collecting company over 30 years ago. You are correct; it's nearly impossible to change money habits of individuals/people. I spoke with so many deadbeat debtors that seemed to be of at least average intelligence, yet I knew there was no changing these people. What happens is that these same people go around to another company or family member and just rack up the bills again; much like an infestation which refuses to be halted. I believe it's an ingrained/learned habit that works for them, they enjoy it and really have no goals for ever changing. The "predatory lenders" will continue to be in business because...yep, there is a Big Market for them. If no one used them, they would not be in business.
Exactly! If they won the lottery, they'd be More Broke in two years than they are now. I have had a friend like this for about 25 years; my impression is that she's too far gone to ever hope to be above-water. She has had Multiple chances, in my humble opinion, to turn it around. We both went to nursing school together and were about "equal" financially at that time. She still is a nurse And giving plasma 45 minutes away to make extra money. It wasn't any one event which occurred to pique my interest in our differences. It just gradually happened over time; we both had husbands, we both got divorced around the same time.
@AmandaHugenkiss2915 As someone who works in the car industry Altimas are a meme. Altimas are the go to car for people who have no money and /or have shot credit
@evangonzalez1565 It's a real thing. Nissan would sell a car to almost anyone with a pulse. VW is not far behind along with Mitsubishi and Dodge as well. If you see someone driving one of these cars, they either have bad credit or poor judgment, probably both.
Totally agree - you see these sort of loans all the time on Caleb Hammer and people rarely understand why suspending/deferring payments is a really bad idea.
It's not just the car seller either - during COVID, prices went through the roof due to the unavailability of some components and manufacturers wanted into that action and raised the MSRP to match. Now with the economic downturn paired with the fact cars are less reliably made and _excessively_ expensive (I''m looking at you, Stelantis), all these car lots are just sitting on inventory and yet people STILL go to Carmax where they can't bargin down the price AND they're asking the same for used vehicles as they ask for new. It's ridiculous.
This happened to my in laws. They ended up paying for four years on their RV they lived in and still owed the same amount as the original purchase price. I tried to explain it to her but she just didn’t get it
Totally agree. And after watching this, it’s even more imperative that I keep using cash and staying patient with my purchases like you mentioned. It’s getting crazy out here. We work so hard for our money for a company to be able to take more than they need….just because they can.
You are totally correct. I love people who say well in the 1950' families had one income and could afford a home. Well we do not live like the 1950's. Not even close. I am going to pick on women because I am one and that is what I know and have reseached this stuff. The average American women had 3 pair of shoes in the 1950's today it is 22 pairs. Women had 2 to 3 purse. Today it is 17 purses. Why would you need 17 purses? Only 7% of women colored there hair back then, today 80% of women color there hair. Then if they are paying for nails, all the make-up ect. A average American women today will spend $350,000 on just make-up over there life time. That does not include botox or BBL. Back then You did not need to buy some updated phone every 2 years, your phone lasted for decades. The average new home in the 1950's was 995 sq ft. Today it is 2240 sq ft. Our life style creep and this belief you need this crap is why people cannot save. Like when I was a child we maybe went out to eat once a month to a nice sit down resturant. A real treat was a bucket of KFC. Even my Dad brought his bag lunch to work and we belong to a country club bit we never ate there because of the inflated prices. But my Mom love dropping us off at the swimming pool all day. Yes back then your parent did not have to babysit. You did not behave you got sent home for your parent to deal with it. In fact my Mom favorite saying was "money does not grow on tree" and "you have allowance so save for it, if you want it that bad". Meanwhile I now see people who throw away perfectly good stuff away because the color is out of style or petty thing. Meanwhile I love bragging about my 1980 stove. I am using until it no longer works. 😂😂😂😂😂 But at one time people did not get into debt because it was not so easy to get. My feeling if you are put $5000 down a car and finacing some $50k you should screw the fancy car, and get the best car you can for $5k and then save that money you would make on payment and save to until you can actually buy the car outright. People also need to realize it does not matter of you make $200k a year of you are still living paycheck by paycheck because spend all the money on things you do not need.
That or they will see it but they won’t let it “sink” in their brain. They would rather drive a “cool nice car” than a hooptie ( from the words of a person who has a 08 civic with my number held on with zip ties lol. I rather have my paid off gas saver than that money trap)
It’s not that they don’t care. It’s that they think they have no choice. They “turn on you” because they already feel trapped into a corner. It feels like you’re kicking them when they’re down. .
Exeter isn't even the worst one. Westlake is easily the worst and Santander is not far behind. Carmax's primary lender is Capital One. Carmax isn't the bad guy here, Exeter is a national level lender that almost all dealers use.
I worked for the car superstore for a year and this is true. Most loans through these lenders were 28% APR, with little to no down payment for the longest term possible.
Ugh, Exeter. My dad was not awesome with money and had an active loan with them when he died. I paid off the loan with my own money (thanks, Ramsey crew--I had no debt and enough emergency funds to do this) and they refused to release the title for over 4 months while I waited around so I could sell it. I'll give them this--all of their customer service people were very nice, even if they were all unhelpful. I wonder if they disliked their employer as much as I did.
@@jorgemoro5476 Likely the car had more value than what was owed on it. So by not paying it, the bank will take it and sell it. By paying it, you keep the car, sell it, and make a little bit of scratch.
There is a weird rule about needing to wait 90 or 180 days after a death to be sure the estate doesn't go into probate. I don't think the delay in the title being sent to you was intentional.
I imagine some of the people taking out these loans need reliable transportation to get to and from work so they can feed their families. It's got to be tough.
The best way to prevent this is to be proactive and plan to make two extra payments at the start of the loan, then pay it as normal. Be your own deferment. Also, NEVER take a loan to full maturity. Borrow just what you need and pay it off fast as ass.
I’ve only got loans a few times from a dealer. Once just to get a lower price, then I paid it off on the first payment. Usually I secure my own loan through a credit union or bank, and always payback early.
I briefly worked as a finance manager on a small used car lot, that specialized in sub-prime transactions/customers.... This is all 100% true. 😭 Consumers would be APPALLED if they actually understood the true numbers/money that is going to the dealerships for this predatory lending. If the dealership got 100 deals locked into their books, they would get a $1 million bonus. The longer the customer kept that sub-prime loan, they would make a ridiculous sum off the deal. (In addition to all the add ons built into the loan.)
Do dealerships still get paid if you literally pay off the loan the next day? And is it true they actually ask people to “not pay it off too soon”. Lol. That just sounds shady as hell.
The big one is solar panels , in low income neighborhood there are a ton of solar panels because of these predators targeting people with promise of lower bills but it's a scam and they lock you in for live
Yeah, I still don't get the trend on solar panels. I find those to be one of the biggest scams that are out there. I still can't figure out how people "save" money on them. You'd have to live in that house for 100 years to even break even on them, especially if you didn't pay cash for them and you have all that interest on top of the cost of them.
My sons freind came over a couple years back. He was upset at his fiance and her dad about the used subaru she bought. As i listened to him i asked if he had the paperwork. The payments vs price of the car didnt make sense. He cam in and looking at the paperwork. It was an $8000 car, they put $4000 down so with taxes and such finance amount was $5600, but it was a 60 month loan at $550 a month. I was so mad, i called the dealership and told them i was turning them into the state for fraud. When i told him even at 10 percent rate what his payment should be, he got more upset. So i told him all you can do is just throw money at it, because its simple interest, so you gotta pay extra to pay it off fast. I told him he could be out of the loan in 12mos. I had him also go to his credit union and they gave him an exact schedule to pay it down. They too were appauled at the terms. Apparently her and her dad are not smart people.
There are also HVAC companies who outsource their financing with companies like Exeter, my Mom (pensioner, elderly, sick) got hoodwinked with a predatory loan for an overpriced air pump and new condenser that wasn't even necessary. She had to take out a 2nd mortgage and payoff the predatory loan.
My 1990 Hyundai Excel is financed with Exeter. My payments are $690 a month and my term is only 84 months at a 98% interest rate. With my 390 credit rating I think I got a good deal.
Exactly! People that are the most desperate will do ANYTHING that they can to get to a little bit of money even if the interest is 1000%. That's what these predatory loan companies feed off of. It's desperate people that will pay anything because they do not have any money.
I had a car repossessed once (back when I was younger and less wise) after they sold it at auction for a third of it's value they tried to claim that I still owed them money I told them that they had taken possession of the collateral and chose to sell it at a loss so I owed them nothing and guess how much I paid them? nothing they sold the debt and I spent years telling debt collectors (that I had no contract with) to pound sand that's exactly what people should do to predatory lenders
Thank you for this. I'm one of the dumb ones that took a deferment due to my transmission going out. I thought I was about to pay my loan off and in the Capital One app it says "you may owe an additional $5,000" at the end of your loan. I didn't know what that meant, neither did their call representatives. I'm going to save this amount until I pay my last payment, from that day forward I am never taking a loan for a car again. God that is so shady. People suck.
reminds me of why the car lot sales person was trying do hard to get a loan as well "suggesting" to go with the repair place slightly down the road for any work
@@mariuss.6607No, debt dies with the debtor. The house may be put into foreclosure by the various lenders and taken, but the debt doesn't go onto the next or kin. Now, if you want to keep the house, you will need to pay or refinance those loans into your name, and they may have claims against the estate of the deceased, but the debt itself is discharged and not passed on.
I'm sorry you knew this about your parent; I have a friend who is in this situation as well. I think part of it is that she has two special-needs kids and she wants to try to enjoy splurges/trips to get away from the doldrums of life. Very understandable, although smaller/less splashy getaways can be a blast. For example, a road trip and stay in a modest motel/hotel instead of full-on cruises every few months.
i have need for a trencher, a front-end loader with backhoe. not enough to actually buy them, just rent for, say, three days. could i ask you to rsvp why rent-a-center might not be the best decision?
@@Maxrotor1 the one thing Malcom x said that waa true.. america is designed to screw thr poor ans make the rich richer.. its even more true today.. Tax thr working poor to give medicare and socialist security checks to the non working rich.. its insanityZ
I just forwarded on. I financed my car thru credit union. My loan officer kept me from buying a car that was underwater three grand compared to the sale price. Then the dealer showed they're true color by even being rude to my lender
@@BusArch42credit unions usually say “yes” to loan applications from their members, weather they can afford the loan or not. Credit unions are predatory, too.
My first thought when I saw the title of the video was Titlemax. I lost my truck to them last year after paying them over $3,000 on a $3,000 loan over a period of 2 years. Even after paying all that money I still owed them roughly $2,500 because all I could afford was the minimum payment which barely even made a dent each month. After falling behind on the payments they came and repoed my truck. I've been walking or hitching rides ever since. Predatory companies like this should be illegal as well.
You can juke the dealerships and banks too if you’re smart. When I bought my new car, I noticed it had a higher price to buy in cash than to finance (49k to buy in cash, 39k to finance). Knowing that loans longer than 61 months cannot legally charge prepayment penalties, I signed for a 72 month loan, despite the high interest amount (7%) and verified no prepayment penalty. I also removed all “extras” from the deal. No lifetime service, extended warranty, or Starlink navigation system. Just the base car with base warranty. This reduced my cost to 39k. Then I went to the bank a week later and paid off the entire loan in full for 28k. I cut off 21k in junk overcharges. The dealership got their pay regardless. Only the bank got grifted, and considering how they make money, that’s alright by me. I’m happy to be a bad debtor who immediately pays loans in full to save cash. I’ve already cut my mortgage term from 30 to 15 years too, which caused my mortgage to be sold a few months later to a junk bond holder. Somehow I keep a great credit score. Not sure how, since I have an established track record of paying very little interest on loans.
Debt to income ratio, average length of credit, and payment history are the biggest drivers of your credit score. Folks who say paying off your loans early will ding your credit are broke. Pretty sure they say that as an excuse to not prioritize paying off their debt faster.
Paying off the loan entirely can make your credit score decrease, but paying it off faster doesn't. I have a mortgage and had a $50k loan on something else. When I was paying extra on the $50k loan it maintained a roughly 780 score if I recall correctly. After I paid off that loan entirely the score dropped to 715 and has maintained that since then because of my mortgage. If I took out another loan in something and paid on it for a few months it will likely climb back up, but as soon as it's paid off it drops again. The $50k loan had a 20 year term and I paid it off in less than a year and a half with the last 10 months paying with intensity. Paying extra into it didn't hurt or help my score until I paid it off completely.
@NathanCrouse611 wild, maybe that's because paying it off hurt your average length of credit because when it was paid off it closed the account out? Do you have credit card accounts that remain open to buffer your average? When I was applying for a mortgage the debt to income ratio was the big one that was factored during the underwriting process and all my credit cards had a zero dollar balance.
@@mathehack1 Only debt I have now is my mortgage which is just shy of 3 years old and no open credit cards. All my past debt has been in good standing, never missed any payments so my score never dropped from that. The $50k loan was 6 months newer than my mortgage at the time. I had no other debt. I did have a credit card through most of paying off the loan, but I never used it. I closed it out at some point. That probably contributed to the drop as well. I had forgotten I had closed that card around the same time. Ultimately it shows closing out accounts will drop your score. I don't need to maintain my score anymore though as I don't really want to take out anymore debt, but it will probably remain about a 715 as long as I am in good standing on my mortgage until it's paid off. I already have a house and will be it in for some time I suspect based on the way the cost and interest rates are going. I bought at the weird time where prices stopped going up as much, but rates were still low, so I haven't gained much in equity other than what I've paid on it, but my rate is lower than anything I would be able to get today, so if I sold it for a similar house I'd probably be in worse shape. The last loan I had taken out was on a vehicle in order to buy one and then sell my other private party and pay the loan off with that money. I paid it off in 2 weeks. My credit union said my credit was excellent and would loan me much more than the $7k I was requesting, but it's all I needed.
Actually, the dealership got money from the finance company for sending them the loan. That's why they charged you less for their car. They got it back from the lender. If you pay the loan off early, (like one week) the dealer has to pay it back. They get screwed which is okay because they were screwing you.. That's why the finance guy tells you that bullshit about not paying the loan off too early.
Great. Can you make one for the slumlords “nijjar, Mike and Patricia Nijjar.” Don’t forget the kids and family. They own 1.3 billion in real estate and it’s all slumlord stuff. Killed multiple children already from negligence
George, have you done any videos on the "side hustles" that seem to be replacing get rich quick schemes through online sales funnels people bet on withoit understanding the full commitments required for success? Like "free training webinars" hawking a course or e-product that winds up taking more time or financial commitment in subscriptuons than people trying to get out of trouble can manage?
Ramsey network is a big company, I can almost feel a defamation lawsuit coming with content directly naming the company like this. I think your work is the finest of public services, I hope It gets to the people who need to see this most
Presumin George was factual ... they wuld hav a VRY difficult time showing harm & thus attempting 2 receive injunctive relief ... & i almos suspect Dave wuld b willing 2 giv the legal dept.A modest budget jus 2 mess w/ em ... 😊
DR is the type of person who would examine the evidence, realise it's solid, then man his position in the trench and STAY THERE until the exeter hordes left.
Even if the consumer does understand- if their choice is essentially to lose their transportation now or five years from now most would still take the extension.
Please, if you MUST take out a loan, READ THE BLOODY CONTRACT and ask questions. If you need to, take it home and take your time reading it. Better yet, PAY CASH!
@ i’ve never seen a homless veteran.. the one ls whi claim to be homeless are fakes just trying to get a fee dollars .. veterans in america are absolutely showered with free money and perks.. when they are hurt or even fake pretend being hurt they get welfare disability for the rest of their lives. They even get all kinds of cushy ass jobs before anyone else.. they are put to the front of the line.. like post office etc. the veterans i know all collect mutiple oension checks, hardly did any work their entire lives and live like millionaires
These aren’t buyers getting a “second chance” these are buyers who can’t afford to buy and shouldn’t buy. Hard part is that not having a car isn’t viable for some people.
I'm not saying they're in the right obviously, but how do they expect companies to provide loans to people who have already proven they didn't pay their bills?
This makes SO much sense and I can’t believe I didn’t put it together before Caravana paid $8k for my car that KBB valued at 4k. It didn’t make sense! Now it does. They sold it to someone for probably about 18-20k and did this. I am sick
I’m very conflicted about this… I used to work for an auto finance company, but we were Not a subprime lender. However, that didn’t stop people from buying more car than they could afford, including not considering the cost of car insurance. I don’t like the “victim mentality.” When people requested extensions, we were required to ask them for the reason for the extension. If they indicated that they lost a job or couldn’t pay it, and there were no prospects of income in the near future, we had to Deny their request for an extension. I forget the other details, but mostly they didn’t care about the consequences. They only cared about kicking the payment to the end of the loan, very short-sighted. Frankly, I don’t think they would have made different decisions even if you had told them exactly how much the extensions cost.
Videos like this neglect to include freedom in the argument. I’m all for informed decision requirements, but no matter how many you require, people are still allowed to make their own financial decisions.
How is a disabled veteran living off VA Disability a deadbeat? Especially one that actually fulfilled his contractual obligation for the cost of the car?
@@arthurmario5996hes not saying every vet😂 he means this man who literally cannot work and is given gov benefits because they recognized he is disabled no ones talking about excusing vets
@goolqui people take advantage of young soldiers. They get themselves into poor financial situations rather quickly they wind up getting ridiculous auto loans as well as personal loans
Because they are lazy and don’t want to work.. they just want a welfare check.. lazy shits cant even do their job of securing the border. Meanwhile the officers in the deadbeat military are gettimf $100,000 pensions and free healthcare for life
Had a 19-year-old buddy back in the service went to a dealership and came back with a car that LITERALLY was his entire take-home pay per month. He hadn't calculated in insurance at all. When that all came to light, he went back to the dealership and they sent him away. He then went up the chain of command and our CO called the dealership and told them if they didn't take the car back, he was going to blacklist them and they'd never get any service members in there again. They took the car back. Many companies prey on military because they're young, out of the house for the first time, and not financially savvy. You'll usually see many shady used car dealerships near any base.
I mean to be honest, basically all auto loans (at least that I know of) are simple interest loans. And nearly all lender will still accrue interest while they allow a deferred period. So this practice is not one lender specific. Valid argument can be made in how each lender can/should disclose before hand information how it works and how much of additional accrued interest that a set deferred period is adding to the loan. Gets complicated as I’m sure most people don’t pay on the exact due date every month. Paying a single day early or late, then the original amortization schedule will be off.
So what? Everyone involved are adults. The company gives people what they want, no one is forced. Why is the Ramsey crew so intent on wiping out personal responsibility?
Taking advantage of a fellow human has been happening since the dawn of time. Wild animals and plants will take advantage of each other, given the opportunity. High-risk lenders like this only exist because the consumers allow it. What Exeter is doing can be viewed as being "slimy" (and IMO, it is), but I don't believe any people trapped in one of these loans was FORCED to sign the contract. At some point, the borrower has to assume responsibility for their actions.
There are another group of people who need to take responsibility for this! It's the elected officials who allow this type of practice to happened without considering the damage its causing. It doesn't help when people hurt by this are either electing or re-electing those in bed with the predatory lenders. This is where comprehensive financial education is needed to ensure future generations don't find themselves in the mess past generations got in. Sadly, not everyone will have access to it, but there's no excuse for taking preventative measures. There's a saying that goes the best way to survive an accident is not to be in one in the first place.
Stop looking for your government to save you from yourself. My goodness, they can barely manage to reissue you a drivers license when your old one expires. Look after yourself. Buying a vehicle that you need to pay off for the better part of a decade is squarely in the, "You did that yourself," category.
The core of these problems can be resolved (eventually) with better financial education. I would like to see schools make this part of the curriculum and teach people how finances (including investing and budgeting) works. Eventually we will have the core of this problem fixed. In the meantime, I would be in favor of stricter lending laws and regulations to provide education in a simple way for those borrowing money so that they understand the impact of their choices before they make them.
Schools suck tho. Parents should be teaching their kids how to appropriately handle finances. What I _would_ like to see are classes you can pick up at a local community college for like $50-100 on how to do basic financial things and there's also UA-cam. People have to educate themselves cause schools really don't have the bandwidth for it.
I’m a little worried now. I bought an old truck from my brother by paying off his loan from a buy here pay here and giving him $600 dollars on top of that. The check to payoff mortgage cleared over two weeks ago and I’m still waiting in the title. Can’t register or insure it until I get that.
Well this happens for several reasons. Lack of financial education and poor credit scores. But many time loan can be deceiving because just because it say it 10% or 20% that does not mean the interest equal 20% of the loan. Basically a 4% loan over 30 year basically double the price of a home. But when you defer a loan until the end of that loan they will just keep adding interest until it is paid off. The best thing you can do with any loan is to send any extra money you may have with your payment each month and have that money go toward the principal of the loan. Not the interest. Send with the check and write on the check it for principal only. This will lower the actual loan amount. Remember in any loan the first few years almost all the money goes toward interest and hardly any goes to actually lower the amount you own. Even send $50 to a $100 can make a huge difference over the course of the loan.
Compound interest is amazing. When you miss a payment, it is amazingly bad for you. If you have a $30,000 loan for 7 years at 25%, your monthly payment is $760/ month. If you miss a single payment at the end of the first year, you will still owe $3,200 at the end of seven years (I rounded off a bit). Four times that missed amount. OF course, there could be additional fees as well.
Can these people contact the CFPB? I think the disabled veteran will have a real case of the company being in violation, because he's a protected person.
Umm that disabled vet could of stopped paying and just hid the car in a garage to prevent repo. You cannot have your disability payments garnished by such creditors.
I know somebody that buys totalled cars. He sends out people to get the same type car and switches out the main vins amd bam, a new used car to sell. But he dont sell. Just gives them away to poor people and hope they dont do stuff that get car dissassembled to the point of the real vin being checked.
If people went back to using cash, these thieves' banks would be out of business. We need to stop leaving above our means. Start buying what you can afford and stop trying to impress your broke friends.
" stop trying to impress your broke friends"... YES! that's how i do it. people i've known for many years through family look down on me but i'm not the one dealing with collection agency calls during supper.
OMG!! I had this company AND ended up owing $9k at the end of my loan due to deferments! I had to get a title loan to pay them and that was even worse. 😢But I didn’t have $9k to give them. I thought I could keep making payments until I was paid off, Nope! At the end of your original term you have to pay all $$ due from those deferments in a lump sum!
$100k is no longer enough to retire even in a LCOL area. Should definitely start expanding our horizons... !!how can i get a good trade to increase my money to 1MM$
I make $345k a MONTH. Mind you I have no children and zero debt. I have a six figure portfolio (Stocks, crypto crowdfunding real estate, savings, and CD's) it wasn't easy. I hustled, saved, and invested my money. I always tell people "Money can't fix stupid"
I want to compliment you, you have said it all. I am a little business owner and I really want to expand my business to the next level by making myself an investor but I really don't know how to go about it..
Venturing into crypto as a newbie was very difficult due to lack of experience which resulted in loosing funds... But miss harriet dixson, restored hope shes a good woman
I agree these are horrible products and something many of us would never do, but when do we get to become adults and take responsibility for our own actions without blaming someone else?
Exeter is not evil. The people that took out these longs are higher risk. Also, if you have a payment due Jan 1 2025 and extend it to Dec 31 2027, there is additional interest to be charged AND it changes the principal / interest calculation on subsequent payments.
So-called predatory lenders zero in on people who aren't smart enough to know any better. That is how this works. It has nothing to do with race or income.
The only SOLUTION is NOT to take any car (or CC) loans. If you can't afford to buy a new car and pay most of it in cash, then - just don't buy a new car! It's so simple ! Another option is if the dealer has an option for a 0% loan without any nasty surprises included. In that case this would be acceptable, I guess. 0% loan is still not a good option, because you never know in what financial situation you would be in the next year or after 5 years, so I would say it is acceptable. And in 0% loan scenario the buyer still should provide at least 30-40% of the cost upfront (you call it downpayment , right?). Every loan above ~4%-5% should be considered unacceptable, unless the loan is directly used to make MORE money.
All the fees are shown and anyone can use a calculator to find out how much it will cost. Now, it's common knowledge that payday lenders and all those quick-money marts, with fees included, are ridiculously bad financially for you. All the information is available. People still do it.... can't fix stupid.
Walkable, bikeable, and public transit communities elevate people into higher social classes. Buying a car is super expensive, even a paid off car, but in most of the USA , it's car dependent and cannot live without one. In cities, people have option to not own a car and save the money for schooling to get high paying jobs
@daniels2761 depends where you live. Even in NYC, you can pay $1000 rent with roommates if you make compromise on comfort, QOL, and location. In smaller smaller cities with good biking and transit like Philly, you can pay half that rent but with a bit lower salary then. Those cities, you can just use a moped instead and all the maintenance can be DIY
Our son is 23 and we are blessed to live in one of those communities. He doesn't even drive (has a Ninebot for his commute and takes trains to NY, Philly and beyond). Even though he makes a bit over minimum wage, he's saving $$'s. My mother is older and just got rid of her automobile and has learned to Uber. For what she was paying insurance and maintenance, she can Uber for groceries and Dr's appts several times each week. But yes, I agree, it takes living in a special kind of semi-urban, safe and weather-friendly place to make this all happen.
discussing the extensions (around 6 minutes) that's the borrower's fault for not knowing that. lenders are there to make money, if you 'add' money to your loan (by not paying something) the interest increases. that should be common sense. (From the video) they didn't say these companies charge you extra fees for doing these deferments. Imagine if the lender didn't grant the extensions? They'd have lost the car. (10 minutes) they DID NOT pay every penny owed. The (example) 'missed' 12 payments! They're ADDED to the end of the loan, that WAS explained to them.
We are long-time Carmax customers. On our last purchase, we were the only customers in the showroom not financing, and a young woman was crying because she couldn't get financed. None of those people could truly afford the vehicles that they were purchasing. No matter how many laws you pass, which always have unintended consequences, trying to keep fools and unethical businesses apart is a fool's pursuit (not referring to Carmax). The key is education. We so terribly need to include personal finance education in our HS curriculums.
Ah yes, the arrogance of the wealthy. Automobile transportation is getting more expensive and wages are stagnant. People are having a tough time affording housing, autos etc. Since you call these people, "fools", you deserve to be called an arrogant snob. I suggest, as I have done, help people, who are responsible, finance autos. God bless.
@@Goodkidjr43 I wasn't referring to all borrowers. I financed vehicles before I learned how badly it was robbing my future wealth. I hope that you didn't vote for the mess of the last four years.
@@Goodkidjr43 they are fools simply by trying to buy an overpriced Carmax car. Also, there are these things called beaters. You buy an older, known to be reliable model, that looks like hell but is in decent mechanical shape. Yes, it takes research and due dillegance, but if you are broke, that's what you do. You do NOT go to a Carmax with their inflated prices just because it is "easy" then complain you can't get financed. That is foolish.
This was a boomers comment wasnt it?
I financed my last car at under 1% interest rate, while being able to keep the money I would have paid upfront invested and earning far more than that. How exactly is that foolish?
I work with a bunch of people who don't know how to manage money. They all have loans on cars that they can't afford. Their cars are always breaking down. They're always calling in sick to work, or showing up late, or coming in smelling like booze or weed from their partying the night before. You can't fix these people. You could wipe out all their debt, and give them a new car, and 6 months later they'd be back in their same positions. Predatory lenders are only part of the problem.
Absolutely!!!
I knew someone with five children. Four are normal, one is as you described. 🤷🏻
100% SPOT ON! DIRECT HIT!
They are sheep of the world who have been taken to slaughter for over 2000 years!
I was an internal auditor for a major bill collecting company over 30 years ago.
You are correct; it's nearly impossible to change money habits of individuals/people. I spoke with so many deadbeat debtors that seemed to be of at least average intelligence, yet I knew there was no changing these people. What happens is that these same people go around to another company or family member and just rack up the bills again; much like an infestation which refuses to be halted. I believe it's an ingrained/learned habit that works for them, they enjoy it and really have no goals for ever changing. The "predatory lenders" will continue to be in business because...yep, there is a Big Market for them. If no one used them, they would not be in business.
Exactly! If they won the lottery, they'd be More Broke in two years than they are now. I have had a friend like this for about 25 years; my impression is that she's too far gone to ever hope to be above-water. She has had Multiple chances, in my humble opinion, to turn it around. We both went to nursing school together and were about "equal" financially at that time. She still is a nurse And giving plasma 45 minutes away to make extra money. It wasn't any one event which occurred to pique my interest in our differences. It just gradually happened over time; we both had husbands, we both got divorced around the same time.
Glad someone is doing this, call these scumbags out BY NAME
Bruh I thought you were about to expose Nissan! 🤣🤣
I would love love love to know how many Nissans out there are subprime compared to other brands. Especially Altimas.
@@AmandaHugenkiss2915 He's talking about the thumbnail for the video. You can tell by the grilles on the cars it is a Nissan dealership.
@AmandaHugenkiss2915
As someone who works in the car industry Altimas are a meme. Altimas are the go to car for people who have no money and /or have shot credit
@@evangonzalez1565 Haha, I have a top credit score and make six figures. Love my long ago paid off 2016 Altima. Guess I'm the outlier!
@evangonzalez1565 It's a real thing. Nissan would sell a car to almost anyone with a pulse. VW is not far behind along with Mitsubishi and Dodge as well. If you see someone driving one of these cars, they either have bad credit or poor judgment, probably both.
Totally agree - you see these sort of loans all the time on Caleb Hammer and people rarely understand why suspending/deferring payments is a really bad idea.
It's not just the car seller either - during COVID, prices went through the roof due to the unavailability of some components and manufacturers wanted into that action and raised the MSRP to match. Now with the economic downturn paired with the fact cars are less reliably made and _excessively_ expensive (I''m looking at you, Stelantis), all these car lots are just sitting on inventory and yet people STILL go to Carmax where they can't bargin down the price AND they're asking the same for used vehicles as they ask for new. It's ridiculous.
This happened to my in laws. They ended up paying for four years on their RV they lived in and still owed the same amount as the original purchase price. I tried to explain it to her but she just didn’t get it
That's crazy
We have created a lifestyle that is unattainable. Until we go back to paying cash, being patient, and saving up for items, this will continue.
Totally agree. And after watching this, it’s even more imperative that I keep using cash and staying patient with my purchases like you mentioned. It’s getting crazy out here. We work so hard for our money for a company to be able to take more than they need….just because they can.
Yup. Debt can be used responsibly, but so many people seem to be abusing it and getting themselves into trouble.
You are totally correct. I love people who say well in the 1950' families had one income and could afford a home. Well we do not live like the 1950's. Not even close. I am going to pick on women because I am one and that is what I know and have reseached this stuff. The average American women had 3 pair of shoes in the 1950's today it is 22 pairs. Women had 2 to 3 purse. Today it is 17 purses. Why would you need 17 purses? Only 7% of women colored there hair back then, today 80% of women color there hair. Then if they are paying for nails, all the make-up ect. A average American women today will spend $350,000 on just make-up over there life time. That does not include botox or BBL. Back then You did not need to buy some updated phone every 2 years, your phone lasted for decades. The average new home in the 1950's was 995 sq ft. Today it is 2240 sq ft. Our life style creep and this belief you need this crap is why people cannot save. Like when I was a child we maybe went out to eat once a month to a nice sit down resturant. A real treat was a bucket of KFC. Even my Dad brought his bag lunch to work and we belong to a country club bit we never ate there because of the inflated prices. But my Mom love dropping us off at the swimming pool all day. Yes back then your parent did not have to babysit. You did not behave you got sent home for your parent to deal with it. In fact my Mom favorite saying was "money does not grow on tree" and "you have allowance so save for it, if you want it that bad". Meanwhile I now see people who throw away perfectly good stuff away because the color is out of style or petty thing. Meanwhile I love bragging about my 1980 stove. I am using until it no longer works. 😂😂😂😂😂
But at one time people did not get into debt because it was not so easy to get. My feeling if you are put $5000 down a car and finacing some $50k you should screw the fancy car, and get the best car you can for $5k and then save that money you would make on payment and save to until you can actually buy the car outright. People also need to realize it does not matter of you make $200k a year of you are still living paycheck by paycheck because spend all the money on things you do not need.
Agreed 100%. Hyperconsumerism is killing people. Its awful.
If we did this then prices would come down as well.
George: "I'm calling out the company that's hurting Americans"
Me: WHICH of 20,000 companies is he going to talk about?
Kudos for bringing this to light.
This "boots-on-the-ground" type of content, helping to dispel public financial misinformation is appreciated ❤
Sadly, people who really need to see this story likely never will.
Yea, the problem with those folks who need it don't want to, I know people like that, they'll turn on you.
That or they will see it but they won’t let it “sink” in their brain. They would rather drive a “cool nice car” than a hooptie ( from the words of a person who has a 08 civic with my number held on with zip ties lol. I rather have my paid off gas saver than that money trap)
Spread the word to your loved ones and one acquaintance and tell them to do the same. 🤞
No need to sell people short.
It’s not that they don’t care. It’s that they think they have no choice. They “turn on you” because they already feel trapped into a corner. It feels like you’re kicking them when they’re down. .
Exeter isn't even the worst one.
Westlake is easily the worst and Santander is not far behind.
Carmax's primary lender is Capital One.
Carmax isn't the bad guy here, Exeter is a national level lender that almost all dealers use.
Cac is to up there with westlake and santander
I worked for the car superstore for a year and this is true. Most loans through these lenders were 28% APR, with little to no down payment for the longest term possible.
Agreed, Westlake and CAC are two of the worst offenders.
Ugh, Exeter. My dad was not awesome with money and had an active loan with them when he died. I paid off the loan with my own money (thanks, Ramsey crew--I had no debt and enough emergency funds to do this) and they refused to release the title for over 4 months while I waited around so I could sell it. I'll give them this--all of their customer service people were very nice, even if they were all unhelpful. I wonder if they disliked their employer as much as I did.
You shouldn’t have paid it. Not your debt.
@@jorgemoro5476 Likely the car had more value than what was owed on it. So by not paying it, the bank will take it and sell it. By paying it, you keep the car, sell it, and make a little bit of scratch.
There is a weird rule about needing to wait 90 or 180 days after a death to be sure the estate doesn't go into probate. I don't think the delay in the title being sent to you was intentional.
@@stevesimons2641I hope so but if he was using this company then that seems unlikely.
I feel like I am watching The Fine Print! Please do more interviews like these 🙂
I imagine some of the people taking out these loans need reliable transportation to get to and from work so they can feed their families. It's got to be tough.
The best way to prevent this is to be proactive and plan to make two extra payments at the start of the loan, then pay it as normal. Be your own deferment. Also, NEVER take a loan to full maturity. Borrow just what you need and pay it off fast as ass.
I’ve only got loans a few times from a dealer. Once just to get a lower price, then I paid it off on the first payment. Usually I secure my own loan through a credit union or bank, and always payback early.
I work for an auto loan finance company, and we are supposed to push extensions even if the loan is 15 days past due. I tend to not do that though.
I briefly worked as a finance manager on a small used car lot, that specialized in sub-prime transactions/customers....
This is all 100% true. 😭
Consumers would be APPALLED if they actually understood the true numbers/money that is going to the dealerships for this predatory lending.
If the dealership got 100 deals locked into their books, they would get a $1 million bonus.
The longer the customer kept that sub-prime loan, they would make a ridiculous sum off the deal. (In addition to all the add ons built into the loan.)
Do dealerships still get paid if you literally pay off the loan the next day? And is it true they actually ask people to “not pay it off too soon”. Lol. That just sounds shady as hell.
@JackStna Most lenders have a 90 day charge back period.
People do this with their student loans all the time and then wonder why the loan keeps rising .
The big one is solar panels , in low income neighborhood there are a ton of solar panels because of these predators targeting people with promise of lower bills but it's a scam and they lock you in for live
Yeah, I still don't get the trend on solar panels. I find those to be one of the biggest scams that are out there. I still can't figure out how people "save" money on them. You'd have to live in that house for 100 years to even break even on them, especially if you didn't pay cash for them and you have all that interest on top of the cost of them.
My sons freind came over a couple years back. He was upset at his fiance and her dad about the used subaru she bought. As i listened to him i asked if he had the paperwork. The payments vs price of the car didnt make sense. He cam in and looking at the paperwork. It was an $8000 car, they put $4000 down so with taxes and such finance amount was $5600, but it was a 60 month loan at $550 a month. I was so mad, i called the dealership and told them i was turning them into the state for fraud. When i told him even at 10 percent rate what his payment should be, he got more upset. So i told him all you can do is just throw money at it, because its simple interest, so you gotta pay extra to pay it off fast. I told him he could be out of the loan in 12mos. I had him also go to his credit union and they gave him an exact schedule to pay it down. They too were appauled at the terms. Apparently her and her dad are not smart people.
There are also HVAC companies who outsource their financing with companies like Exeter, my Mom (pensioner, elderly, sick) got hoodwinked with a predatory loan for an overpriced air pump and new condenser that wasn't even necessary. She had to take out a 2nd mortgage and payoff the predatory loan.
My 1990 Hyundai Excel is financed with Exeter. My payments are $690 a month and my term is only 84 months at a 98% interest rate. With my 390 credit rating I think I got a good deal.
Sadly I am sure that even if they are fully transparent, a lot of people would still take the extension.
💯
Exactly! People that are the most desperate will do ANYTHING that they can to get to a little bit of money even if the interest is 1000%. That's what these predatory loan companies feed off of. It's desperate people that will pay anything because they do not have any money.
I had a car repossessed once (back when I was younger and less wise) after they sold it at auction for a third of it's value they tried to claim that I still owed them money I told them that they had taken possession of the collateral and chose to sell it at a loss so I owed them nothing and guess how much I paid them? nothing they sold the debt and I spent years telling debt collectors (that I had no contract with) to pound sand that's exactly what people should do to predatory lenders
Thank you for this. I'm one of the dumb ones that took a deferment due to my transmission going out. I thought I was about to pay my loan off and in the Capital One app it says "you may owe an additional $5,000" at the end of your loan. I didn't know what that meant, neither did their call representatives. I'm going to save this amount until I pay my last payment, from that day forward I am never taking a loan for a car again. God that is so shady. People suck.
6:18 so should stay away from CarMax as well?? I'm currently looking around for another vehicle
reminds me of why the car lot sales person was trying do hard to get a loan as well "suggesting" to go with the repair place slightly down the road for any work
21-29% APR for a car loan.... I wish I had that kind of interest on my savings account!
BooYa!!
My mother refinanced her house so many times that on the day she died, she owed as much as she had purchased it for.
And that's going to be on you?
@@mariuss.6607No, debt dies with the debtor. The house may be put into foreclosure by the various lenders and taken, but the debt doesn't go onto the next or kin. Now, if you want to keep the house, you will need to pay or refinance those loans into your name, and they may have claims against the estate of the deceased, but the debt itself is discharged and not passed on.
@@ajspice the american dream
Technically she never purchased it. She had to title to the property.
I'm sorry you knew this about your parent; I have a friend who is in this situation as well. I think part of it is that she has two special-needs kids and she wants to try to enjoy splurges/trips to get away from the doldrums of life. Very understandable, although smaller/less splashy getaways can be a blast. For example, a road trip and stay in a modest motel/hotel instead of full-on cruises every few months.
From the headline, I assumed you would be discussing Rent-A-Center.
i have need for a trencher, a front-end loader with backhoe. not enough to actually buy them, just rent for, say, three days. could i ask you to rsvp why rent-a-center might not be the best decision?
*Reverse Snowballing* 🥶
I always said the poorest pay the most.
And the system is set up so the rich get richer.. paying social security to f’n millionaires at the expense of working poor
Yep. And they blame it on everyone else.
@@Maxrotor1 the one thing Malcom x said that waa true.. america is designed to screw thr poor ans make the rich richer.. its even more true today..
Tax thr working poor to give medicare and socialist security checks to the non working rich.. its insanityZ
Pizza hut! Yes indeed, a car title loan joint in Lil' Portugal, Ca was a pizza hut in the past.
I just forwarded on. I financed my car thru credit union. My loan officer kept me from buying a car that was underwater three grand compared to the sale price. Then the dealer showed they're true color by even being rude to my lender
Love credit unions.
@@BusArch42credit unions usually say “yes” to loan applications from their members, weather they can afford the loan or not. Credit unions are predatory, too.
I have a loan with Exeter currently and trying to get out of it quickly
I spy the beautiful watch George mentioned on SMHH! Love it! I really enjoyed the video as well, I wasn't entirely aware of this one.
A lot of the cars are junk also. They break down then people have to choose to fix it or pay for a car that doesn't run
My first thought when I saw the title of the video was Titlemax. I lost my truck to them last year after paying them over $3,000 on a $3,000 loan over a period of 2 years. Even after paying all that money I still owed them roughly $2,500 because all I could afford was the minimum payment which barely even made a dent each month. After falling behind on the payments they came and repoed my truck. I've been walking or hitching rides ever since. Predatory companies like this should be illegal as well.
You can juke the dealerships and banks too if you’re smart. When I bought my new car, I noticed it had a higher price to buy in cash than to finance (49k to buy in cash, 39k to finance). Knowing that loans longer than 61 months cannot legally charge prepayment penalties, I signed for a 72 month loan, despite the high interest amount (7%) and verified no prepayment penalty. I also removed all “extras” from the deal. No lifetime service, extended warranty, or Starlink navigation system. Just the base car with base warranty. This reduced my cost to 39k. Then I went to the bank a week later and paid off the entire loan in full for 28k. I cut off 21k in junk overcharges. The dealership got their pay regardless. Only the bank got grifted, and considering how they make money, that’s alright by me. I’m happy to be a bad debtor who immediately pays loans in full to save cash. I’ve already cut my mortgage term from 30 to 15 years too, which caused my mortgage to be sold a few months later to a junk bond holder. Somehow I keep a great credit score. Not sure how, since I have an established track record of paying very little interest on loans.
Debt to income ratio, average length of credit, and payment history are the biggest drivers of your credit score. Folks who say paying off your loans early will ding your credit are broke. Pretty sure they say that as an excuse to not prioritize paying off their debt faster.
Paying off the loan entirely can make your credit score decrease, but paying it off faster doesn't. I have a mortgage and had a $50k loan on something else. When I was paying extra on the $50k loan it maintained a roughly 780 score if I recall correctly. After I paid off that loan entirely the score dropped to 715 and has maintained that since then because of my mortgage. If I took out another loan in something and paid on it for a few months it will likely climb back up, but as soon as it's paid off it drops again. The $50k loan had a 20 year term and I paid it off in less than a year and a half with the last 10 months paying with intensity. Paying extra into it didn't hurt or help my score until I paid it off completely.
@NathanCrouse611 wild, maybe that's because paying it off hurt your average length of credit because when it was paid off it closed the account out? Do you have credit card accounts that remain open to buffer your average? When I was applying for a mortgage the debt to income ratio was the big one that was factored during the underwriting process and all my credit cards had a zero dollar balance.
@@mathehack1 Only debt I have now is my mortgage which is just shy of 3 years old and no open credit cards. All my past debt has been in good standing, never missed any payments so my score never dropped from that. The $50k loan was 6 months newer than my mortgage at the time. I had no other debt. I did have a credit card through most of paying off the loan, but I never used it. I closed it out at some point. That probably contributed to the drop as well. I had forgotten I had closed that card around the same time. Ultimately it shows closing out accounts will drop your score. I don't need to maintain my score anymore though as I don't really want to take out anymore debt, but it will probably remain about a 715 as long as I am in good standing on my mortgage until it's paid off. I already have a house and will be it in for some time I suspect based on the way the cost and interest rates are going. I bought at the weird time where prices stopped going up as much, but rates were still low, so I haven't gained much in equity other than what I've paid on it, but my rate is lower than anything I would be able to get today, so if I sold it for a similar house I'd probably be in worse shape.
The last loan I had taken out was on a vehicle in order to buy one and then sell my other private party and pay the loan off with that money. I paid it off in 2 weeks. My credit union said my credit was excellent and would loan me much more than the $7k I was requesting, but it's all I needed.
Actually, the dealership got money from the finance company for sending them the loan. That's why they charged you less for their car. They got it back from the lender. If you pay the loan off early, (like one week) the dealer has to pay it back. They get screwed which is okay because they were screwing you.. That's why the finance guy tells you that bullshit about not paying the loan off too early.
Only take out a 36m or less loan and get it from the credit union.
But they can't because they are nor creditworthy !
Great. Can you make one for the slumlords “nijjar, Mike and Patricia Nijjar.” Don’t forget the kids and family. They own 1.3 billion in real estate and it’s all slumlord stuff. Killed multiple children already from negligence
George, have you done any videos on the "side hustles" that seem to be replacing get rich quick schemes through online sales funnels people bet on withoit understanding the full commitments required for success?
Like "free training webinars" hawking a course or e-product that winds up taking more time or financial commitment in subscriptuons than people trying to get out of trouble can manage?
Fantastic work, these guys need to look into healthcare costs...
16:00 People taking deferment don't have savings. Otherwise, they would have paid the bill 🙄
I can’t believe there are auto loans out there at 20%+ interest. That is just crazy to me. That should be criminal.
Ramsey network is a big company, I can almost feel a defamation lawsuit coming with content directly naming the company like this.
I think your work is the finest of public services, I hope It gets to the people who need to see this most
Presumin George was factual ... they wuld hav a VRY difficult time showing harm & thus attempting 2 receive injunctive relief ... & i almos suspect Dave wuld b willing 2 giv the legal dept.A modest budget jus 2 mess w/ em ... 😊
That would likely result in a massive amount of publicity about the Ramsey’s claims which could really backfire on Exeter
DR is the type of person who would examine the evidence, realise it's solid, then man his position in the trench and STAY THERE until the exeter hordes left.
So you keep a loan open longer and are blown away your interest continues accumulating? These people deserve it
Even if the consumer does understand- if their choice is essentially to lose their transportation now or five years from now most would still take the extension.
What kind of idiot buys something without knowing the cost? What we need is better educated people.
Desperate people. Like Dave Ramsey always says, "Desperate people do stupid things". He is 100% right.
Congress.
My mortgage company did this to me during Covid when I was laid off. What can I do?
Please, if you MUST take out a loan, READ THE BLOODY CONTRACT and ask questions. If you need to, take it home and take your time reading it. Better yet, PAY CASH!
Or just make the payments as you are supposed to. UnLike the bum veteran who doesnt want to work and live off welfare.
@@keithbellair9508 you’re disgusting. Calling a veteran a bum because you prob hate your life. Hope you figure it out.
@@keithbellair9508where does that negative energy even come from? What did the homeless veteran do to you
@@russg9371 No. $hit.
wtaf did some homeless guy - especially a veteran, knowing how VA treats people... - do to this guy? holy gods, nasty.
@ i’ve never seen a homless veteran.. the one ls whi claim to be homeless are fakes just trying to get a fee dollars .. veterans in america are absolutely showered with free money and perks.. when they are hurt or even fake pretend being hurt they get welfare disability for the rest of their lives. They even get all kinds of cushy ass jobs before anyone else.. they are put to the front of the line.. like post office etc. the veterans i know all collect mutiple oension checks, hardly did any work their entire lives and live like millionaires
These aren’t buyers getting a “second chance” these are buyers who can’t afford to buy and shouldn’t buy. Hard part is that not having a car isn’t viable for some people.
In a twist, this video is 50% ads for companies who offer subscriptions that are easy to start and likely very difficult to stop.
Sounds just like solar panel sales scams.
Exeter call the day after you late trying to give that expensive extension. I blocked multiple numbers and but catch up on my own.
I just refinanced with that company and got my rate down 7% lower than it was with the original loan.
I'm not saying they're in the right obviously, but how do they expect companies to provide loans to people who have already proven they didn't pay their bills?
This makes SO much sense and I can’t believe I didn’t put it together before
Caravana paid $8k for my car that KBB valued at 4k. It didn’t make sense! Now it does. They sold it to someone for probably about 18-20k and did this. I am sick
That's just business. If I buy something for 8 the minimum I'm getting for it is 20. 2.5x or it's not worth it
@ Right. My point is that Carvana is doing this too. I didn’t know where they were gonna make the profit but now I do
I’m very conflicted about this… I used to work for an auto finance company, but we were Not a subprime lender.
However, that didn’t stop people from buying more car than they could afford, including not considering the cost of car insurance.
I don’t like the “victim mentality.” When people requested extensions, we were required to ask them for the reason for the extension. If they indicated that they lost a job or couldn’t pay it, and there were no prospects of income in the near future, we had to Deny their request for an extension.
I forget the other details, but mostly they didn’t care about the consequences. They only cared about kicking the payment to the end of the loan, very short-sighted.
Frankly, I don’t think they would have made different decisions even if you had told them exactly how much the extensions cost.
You're probably right about them not making a different decision even if they had the information... But it's still shady to withhold that information
Videos like this neglect to include freedom in the argument. I’m all for informed decision requirements, but no matter how many you require, people are still allowed to make their own financial decisions.
Buy Here, Pay here car loan places are a legal scam that prey on the poor and desperate. They are as bad as Payday Lenders.
@@JackC602They didn’t withhold it. People frequently don’t bother to look at their statements.
My god I have credit cards with lower interest rates than these auto loans.
😲😲😂😂😂😂
lending to deadbeats is risky business.
allowing people to extend their payments is kinder than most lenders that simply repo the car.
How is a disabled veteran living off VA Disability a deadbeat? Especially one that actually fulfilled his contractual obligation for the cost of the car?
@@peachygal8856 all due respect to vets, but you still have to pay your debts on-time.
@@arthurmario5996hes not saying every vet😂 he means this man who literally cannot work and is given gov benefits because they recognized he is disabled no ones talking about excusing vets
Exeter is one of the last resorts for even subprime buyers. There is no such thing as a “predatory lender” consumers need to understand things
To boot, their low / bad credit score barely rises due to struggling to make on- time payments, etc.
This happens a lot to military personnel
Why
@goolqui people take advantage of young soldiers. They get themselves into poor financial situations rather quickly they wind up getting ridiculous auto loans as well as personal loans
@@rjdelellis1229 thanks
Because they are lazy and don’t want to work.. they just want a welfare check.. lazy shits cant even do their job of securing the border. Meanwhile the officers in the deadbeat military are gettimf $100,000 pensions and free healthcare for life
Had a 19-year-old buddy back in the service went to a dealership and came back with a car that LITERALLY was his entire take-home pay per month. He hadn't calculated in insurance at all. When that all came to light, he went back to the dealership and they sent him away. He then went up the chain of command and our CO called the dealership and told them if they didn't take the car back, he was going to blacklist them and they'd never get any service members in there again. They took the car back. Many companies prey on military because they're young, out of the house for the first time, and not financially savvy. You'll usually see many shady used car dealerships near any base.
I mean to be honest, basically all auto loans (at least that I know of) are simple interest loans. And nearly all lender will still accrue interest while they allow a deferred period. So this practice is not one lender specific. Valid argument can be made in how each lender can/should disclose before hand information how it works and how much of additional accrued interest that a set deferred period is adding to the loan. Gets complicated as I’m sure most people don’t pay on the exact due date every month. Paying a single day early or late, then the original amortization schedule will be off.
So what? Everyone involved are adults. The company gives people what they want, no one is forced. Why is the Ramsey crew so intent on wiping out personal responsibility?
Be a shame is people with bad credit, got a loan from these turkeys, dropped the insurance, and left the car at the beach at low tide.
Taking advantage of a fellow human has been happening since the dawn of time. Wild animals and plants will take advantage of each other, given the opportunity. High-risk lenders like this only exist because the consumers allow it. What Exeter is doing can be viewed as being "slimy" (and IMO, it is), but I don't believe any people trapped in one of these loans was FORCED to sign the contract. At some point, the borrower has to assume responsibility for their actions.
There are another group of people who need to take responsibility for this! It's the elected officials who allow this type of practice to happened without considering the damage its causing. It doesn't help when people hurt by this are either electing or re-electing those in bed with the predatory lenders. This is where comprehensive financial education is needed to ensure future generations don't find themselves in the mess past generations got in. Sadly, not everyone will have access to it, but there's no excuse for taking preventative measures. There's a saying that goes the best way to survive an accident is not to be in one in the first place.
Stop looking for your government to save you from yourself. My goodness, they can barely manage to reissue you a drivers license when your old one expires.
Look after yourself. Buying a vehicle that you need to pay off for the better part of a decade is squarely in the, "You did that yourself," category.
I pass info to folks that struggle.
The core of these problems can be resolved (eventually) with better financial education. I would like to see schools make this part of the curriculum and teach people how finances (including investing and budgeting) works. Eventually we will have the core of this problem fixed. In the meantime, I would be in favor of stricter lending laws and regulations to provide education in a simple way for those borrowing money so that they understand the impact of their choices before they make them.
Schools suck tho. Parents should be teaching their kids how to appropriately handle finances. What I _would_ like to see are classes you can pick up at a local community college for like $50-100 on how to do basic financial things and there's also UA-cam. People have to educate themselves cause schools really don't have the bandwidth for it.
I’m a little worried now. I bought an old truck from my brother by paying off his loan from a buy here pay here and giving him $600 dollars on top of that. The check to payoff mortgage cleared over two weeks ago and I’m still waiting in the title. Can’t register or insure it until I get that.
SMART. MOVE.
one "crisis" at a time makes it more manageable.
I was sooo happy when i payed off my car with these clowns. Great video!
Lol this is why I buy from private sellers. My last car I bought for $1300 cash a few years ago. I fixed most issues myself.
I had the WORST experience with Credit Acceptance!!!
Well this happens for several reasons. Lack of financial education and poor credit scores. But many time loan can be deceiving because just because it say it 10% or 20% that does not mean the interest equal 20% of the loan. Basically a 4% loan over 30 year basically double the price of a home. But when you defer a loan until the end of that loan they will just keep adding interest until it is paid off. The best thing you can do with any loan is to send any extra money you may have with your payment each month and have that money go toward the principal of the loan. Not the interest. Send with the check and write on the check it for principal only. This will lower the actual loan amount. Remember in any loan the first few years almost all the money goes toward interest and hardly any goes to actually lower the amount you own. Even send $50 to a $100 can make a huge difference over the course of the loan.
Compound interest is amazing. When you miss a payment, it is amazingly bad for you. If you have a $30,000 loan for 7 years at 25%, your monthly payment is $760/ month. If you miss a single payment at the end of the first year, you will still owe $3,200 at the end of seven years (I rounded off a bit). Four times that missed amount. OF course, there could be additional fees as well.
predatory lending is extremely common
*Chargers: Im the #1 car in which people buy me without worrying first if they can afford me*
Can these people contact the CFPB? I think the disabled veteran will have a real case of the company being in violation, because he's a protected person.
Umm that disabled vet could of stopped paying and just hid the car in a garage to prevent repo. You cannot have your disability payments garnished by such creditors.
This happened to me with my student loans.
I know somebody that buys totalled cars. He sends out people to get the same type car and switches out the main vins amd bam, a new used car to sell. But he dont sell. Just gives them away to poor people and hope they dont do stuff that get car dissassembled to the point of the real vin being checked.
I've never heard of this company.
If people went back to using cash, these thieves' banks would be out of business. We need to stop leaving above our means. Start buying what you can afford and stop trying to impress your broke friends.
" stop trying to impress your broke friends"... YES! that's how i do it. people i've known for many years through family look down on me but i'm not the one dealing with collection agency calls during supper.
OMG!! I had this company AND ended up owing $9k at the end of my loan due to deferments! I had to get a title loan to pay them and that was even worse. 😢But I didn’t have $9k to give them. I thought I could keep making payments until I was paid off, Nope! At the end of your original term you have to pay all $$ due from those deferments in a lump sum!
Please look at Modified Mtgs drafted in 2008, after housing collapse. Largest racket imo. All big banks involved.
$100k is no longer enough to retire even in a LCOL area. Should definitely start expanding our horizons...
!!how can i get a good trade to increase my money to 1MM$
I make $345k a MONTH. Mind you I have no children and zero debt. I have a six figure portfolio (Stocks, crypto crowdfunding real estate, savings, and CD's) it wasn't easy. I hustled, saved, and invested my money. I always tell people "Money can't fix stupid"
I'm 37 and have been looking for
ways to be successful, please
how??
I want to compliment you, you have said it all. I am a little business owner and I really want to expand my business to the next level by making myself an investor but I really don't know how to go about it..
Assets that can make you rich
*FX
*Btcoin
*Stocks
*Gold
*Real estate
Venturing into crypto as a newbie was very difficult due to lack of experience which resulted in loosing funds... But miss harriet dixson, restored hope shes a good woman
I agree these are horrible products and something many of us would never do, but when do we get to become adults and take responsibility for our own actions without blaming someone else?
Exeter is not evil. The people that took out these longs are higher risk. Also, if you have a payment due Jan 1 2025 and extend it to Dec 31 2027, there is additional interest to be charged AND it changes the principal / interest calculation on subsequent payments.
They make you a debt slave for as long as they can.
So-called predatory lenders zero in on people who aren't smart enough to know any better. That is how this works. It has nothing to do with race or income.
It definitely relates to race then
They not only prey on the lower class but prey upon those who don't understand basic math
The only SOLUTION is NOT to take any car (or CC) loans. If you can't afford to buy a new car and pay most of it in cash, then - just don't buy a new car! It's so simple ! Another option is if the dealer has an option for a 0% loan without any nasty surprises included. In that case this would be acceptable, I guess. 0% loan is still not a good option, because you never know in what financial situation you would be in the next year or after 5 years, so I would say it is acceptable. And in 0% loan scenario the buyer still should provide at least 30-40% of the cost upfront (you call it downpayment , right?). Every loan above ~4%-5% should be considered unacceptable, unless the loan is directly used to make MORE money.
Those who can afford the most PAY THE LEAST. those that can afford to pay the least PAY THE MOST!
All the fees are shown and anyone can use a calculator to find out how much it will cost. Now, it's common knowledge that payday lenders and all those quick-money marts, with fees included, are ridiculously bad financially for you. All the information is available. People still do it.... can't fix stupid.
Walkable, bikeable, and public transit communities elevate people into higher social classes. Buying a car is super expensive, even a paid off car, but in most of the USA , it's car dependent and cannot live without one.
In cities, people have option to not own a car and save the money for schooling to get high paying jobs
Even without needing a car, that's a tough pitch when you have to pay $3000+ a month rent.
@daniels2761 depends where you live. Even in NYC, you can pay $1000 rent with roommates if you make compromise on comfort, QOL, and location. In smaller smaller cities with good biking and transit like Philly, you can pay half that rent but with a bit lower salary then.
Those cities, you can just use a moped instead and all the maintenance can be DIY
Where I live it’s 117F in the summer. Nobody walks or bikes after 9 am. It stays over 100F even at 9 pm. It’s not practical at all to not have a car
Our son is 23 and we are blessed to live in one of those communities. He doesn't even drive (has a Ninebot for his commute and takes trains to NY, Philly and beyond). Even though he makes a bit over minimum wage, he's saving $$'s.
My mother is older and just got rid of her automobile and has learned to Uber. For what she was paying insurance and maintenance, she can Uber for groceries and Dr's appts several times each week.
But yes, I agree, it takes living in a special kind of semi-urban, safe and weather-friendly place to make this all happen.
Not true. Look at Korea and Japan
I am happy to say I have never had a car loan.
discussing the extensions (around 6 minutes) that's the borrower's fault for not knowing that. lenders are there to make money, if you 'add' money to your loan (by not paying something) the interest increases. that should be common sense. (From the video) they didn't say these companies charge you extra fees for doing these deferments. Imagine if the lender didn't grant the extensions? They'd have lost the car. (10 minutes) they DID NOT pay every penny owed. The (example) 'missed' 12 payments! They're ADDED to the end of the loan, that WAS explained to them.
It’s a loan modification. It should treated as such