Car Dealers & Banks SCREWED Buyers, Now They're Paying The Price

Edmunds Article:
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Watch out for the tsunami! Ray and Zach dive into some disturbing news from Edmunds: the amount of trade-ins with negative equity is increasing, and the average amount of money owed on these vehicles is also on the rise. Dealers are taking advantage with predatory "Upside-Down Payoff Sales Events." What a mess!

[@GuthD]

I tried to get a car today, the dealer said, 'these prices are non negotiable.' I got up and walked away. That was even before a test drive. They don't seem to be feeling it yet.

[@flacofadez]

Probably depends what part of the country you live in. A populous city might still be in business longer than a rural area idk tho

[@davidp.4727]

“And my budget is non negotiable, bye!”

[@cormaro13]

Sounds like u need to call different dealership isn’t of just walking in lol

[@pamc3338]

Yup, they're still playing head games.

[@bernie6355]

In Canada dealers are still not negotiating

[@mapmike52]

The banks never should have been approving loans beyond the value of the vehicles. Greed that is going to come back to bite them.

[@netomartinez1512]

The government would bail them out by using the working class money

[@waynek805]

@@netomartinez1512Technically they are using money that does not currently exist (printed into existence by the Federal Reserve) but yeah we all pay the 'inflation tax' on that. The USA will get away with this nonsense until we can't anymore.

[@bryanlentz7160]

@@netomartinez1512there’s no such thing as “government funded”, it’s all TAXPAYER FUNDED!

[@MurphyBrothers70]

Glad banks are getting better at not loaning above what it worth

[@garybeaty4032]

The banks have no consequences. They run the world and do what they want to do. All governments fall under control of the banks

[@TeksonikAudio]

Play stupid games win stupid prizes. We need to take personal responsibility and not buy a product we can't afford. If we all did that then dealers would be forced to lower prices.

[@myotex4199]

They used their free unemployement that us tax payers pay for to put down the down payment for the cars they cannot afford. They get everything they deserve.

[@Dooguy]

Yeah but that would take commone sense. Americans lack alot of that.

[@joeshmoe9978]

People need to check their egos and need for status as well.

[@marklytle7829]

Dont put it all on the buyer. The seller knows what they’re doing .

[@brianasbury8315]

Amen

[@tankervargas6761]

i went to a local dealer in Albuquerque New Mexico during covid19 they try to sell me a Silverado pick up for 15000.00 above MSRP I said I'll be back when you can sell it to me for or under MSRP at that point the sales person said you going to be waiting a long time I said I got time I'm still waiting .

[@cormaro13]

😂 they’re doing that already on lots here in Texas , start doing the jerk off motion to the salesman whenever they say that , cause they need it lol

[@JohnDoe-wy2py]

Local Nissan dealer has a used 2022 Nissan Frontier advertised for $27K which gives it a "great deal" rating by CarGurus. The out the door price after all the BS fees is $36K. A sample of some of the fees. $1000 more if I don't have a trade-in. Another $1000 if I pay cash or arrange my own financing. But the one that really got me, $2900 reconditioning fee (they washed it). Doc Fee $999. and other fees. It's no wonder this dealership has a F rating by the BBB.

[@brianasbury8315]

Crooks

[@rwgarchia5187]

im keeping my car till it blows up. with me in it 😂

[@markadler8968]

Imagine having a significant amount of negative equity in your current car only to get another vehicle and sign up for even more negative equity because you want a shiny new car.

[@jorgemoro5476]

People are stupid and greedy. Many will do the negative equity deal.

[@RossBurroughs-gu5tl]

Some times it's not a want but a need, work or lifestyle changes happen fast

[@SaltyDomeRat]

Why would you already want a new car? I would have never thought of buying a new car till the old one was paid for and I had 20% cash down. What the hell is wrong with everyone. Go wash that car and fall in love with it again.

[@Bigmac79alex]

Manufactures spend fortunes on advertising to make people always want the next model and give out free cars for content creators to make reviews about why their car is good and better than the competition. It becomes a cycle that the car you bought a year ago no longer has bragging rights even though it is good enough for the needs of its owner. Plus there is segment of the market that is okay always having a car payment. They don't shop based on the price of the car, they shop by how much the payment is. The car aggregator sites picked up on this and have shop by payment price instead of total price. A quick dopamine dump by having some new car and a lifelong of debt rolling into the next car

[@761jared]

Unfortunately, many new cars are barely lasting until they're paid off before significant issues develop. Ford and Toyota CEOs have both recently come out to say their quality systems need to be drastically improved, but given all the press across the board, they're the only ones who've been upfront about it. GM and Stellantis just haven't spoken up, despite having the same issues.

[@SaltyDomeRat]

@@Bigmac79alex I get the psychology of it but at the end of the day you can’t be your own worst enemy.

[@SaltyDomeRat]

@@761jared Buuuuulllllllsheeeeeeet Jared.

[@leok7193]

Ideally, you'd only buy a new car when you've had plenty of use and saved up, but plenty of reasons to swap out ASAP: your needs change (need a truck, have a coupe), costs you more to keep the current car running (whether it's gas price, maintenance, or reliability), depreciation is about to hit (many cars' value drops like a rock when warranty drops, you it certain mileage...), you're downgrading (got a 100k car with a long loan, and you're actually better off taking the hit on upside-down equity than paying it off in full due to interest or your monthly budget), and many more

[@chrisanderson4799]

I haven’t had a car payment in 20 years. I put $500 a month in a car account and use it to fix my vehicles or buy something when I need to replace. I’m the bank!

[@Omaba_Baba]

Very smart, requires a lot of discipline. Good for you, for real.

[@dvader3263]

So the amount of money put into an account every month to spend valuable time fixing old vehicles is the same as a payment on a new vehicle. OK.

[@diannacook3514]

I'm saving 500 a month for a new vehicle in Dec. I haven't have a vehicle payment in 12 yrs, I deserve a new vehicle 😊

[@LeeDoesStuff]

@@dvader3263no it’s not the same because he isn’t paying any interest. On a 75 thousand dollar over priced vehicle with today’s interest rates will cost you 25 grand or so. If you are taking out a loan on a vehicle today you are getting absolutely rinsed.

[@StlPike2004]

and what do you drive? an old clunker?

[@MuahMan]

I'm actually surprised its so low at negative equity trade-ins. I figured it would be around 75%. I just saw a Ford Ranger selling for $52K new. No way it's worth 25K as soon as you drive it off the lot.

[@wallye8713]

ATTENTION Car Edge. You need to showcase all the places dealerships are stacking inventory… vacant office buildings, horse track parking lots and shopping malls as they have many hundreds if not thousands hoarded in New Jersey!!!

[@761jared]

I don't think they're hoarding them, but people are unwilling to buy these overpriced vehicles with the current interest rates. From what I understand, the factories are just pushing them out to keep those workers on the line, and not have to pay them to sit at home due to any recent union negotiations.

[@WillieWalnuts]

I'm going to try and get some drone footage this weekend. There's a bunch of lots where I'm at that they store all these cars. I am going to throw it up on my KZbin channel.

[@Intwodeep902]

Prices are not budging here in North Carolina!

[@saeedhossain6099]

​@@Intwodeep902as a buyer/consumer, hold out, dealers were gorged on cheap and easy bank credit for themselves and their customers, now the manufacturer is doing that because the banks have exited, it's only a matter of time that these easy credit policies will bite them again.

[@mikenimmick3920]

NOBODY screwed the buyers. The buyers willingly bought these vehicles that were grossly over priced. Nobody held a gun to their head. Dealers have always been dishonest. Face it...some people are just freaking stupid and no amount of education or advice will stop it..

[@jonathantaylor6926]

I think a huge part of it was that people went to trade in their 3 year old car and were shocked to get all their money back. Zero depreciation. So people were okay paying an ADM. It was a giant positive feedback look where appreciation created more appreciation. People actually started to view new cars as ** investments**

[@guitarexpert2245]

That's the truth!

[@19Silver67]

Took the words right out of my mouth!!! I seen this coming back in 21.

[@dm1927]

You exactly right sir 👍

[@fireboltaz]

Agreed. I say to them "Congratulations, you played yourself"

[@counterbalancelife4305]

New car every 3-3.5 years? I can't fathom that. Our 9 and 12 year old vehicles are going strong. Paid off vehicles are just more comfortable to drive.

[@geoffreykeating8172]

Agree I buy a new vehicle every ten to fifteen years , if not I would just lease

[@luism8130]

They don’t make cars that last that long anymore. Any car made in the 2020s is designed to last 5 years at most. These new cars are all junk.

[@petrosaguilar8916]

I kept my last vehicle until 310k miles. Scrapped ut only because the rust got so bad there were holes in the floor

[@GusMahn]

And park without worry

[@counterbalancelife4305]

@@petrosaguilar8916 Got your moneys' worth. Have you considered Fluid Film, Woolwax, or Surface Shield?

[@matthewhuszarik4173]

Anyone who bought a grossly overpriced vehicle the last couple years with any intention of selling it within a decade are fools.

[@Sam-M7]

Calling them fools is being kind. I’d say they are brain dead

[@MikeBarbarossa]

If you're trading in a car with negative equity, you are a fool. ( 30% had neg eq traded in 2019 they showed) Lots of fools out there amazingly

[@jkairi4]

We'll, Carmax and Carvana will give you the most for them

[@XBLHAX]

Straight up...Any smart person who saw these astronomical car prices knew there would be no recovery for these foolish buyers.. Its basic economics.. these people were foolish enough to buy a depreciating asset for +250% MSRP with highest interest rates in history then be proud like it's a life accomplishment LOL.

[@jneuf861]

also they helped raise the prices

[@n7y8c7]

So the chickens of $75k Tellurides and $50k Rogues are coming home to roost.

[@thomaschiappa1104]

Keep your car for at least 10 years and don’t worry about being upside down

[@AJourneyOfYourSoul]

Yup, I have had my f150 for 23 years now.

[@archimedes2261]

A new car can easily last that long and more after.

[@roman9762]

Not all of us want to live in the projects

[@dominickgalgano2296]

Power to this channel.. shine light on the things the common person doesnt understand.

[@oshkoshbegone]

The thought of a car payment hurts my brain, as i paint over the rust on my old truck...

[@Bdub1952]

You mean, nobody said "You're paying $15k over MSRP, you know you'll take that hit on trade-in, right?" A crisis of their own creation.

[@matttelz6014]

Visited a FORD dealer in MD. They had some Mustangs in the showroom with $5-10K ADM's on each vehicle....what a joke. Not a single person in the dealership looking at new cars... wonder why.

[@joeshmoe9978]

Especially Mach-E Mustang. 💩

[@PumpkinKingXXIII]

The way to fix it is keep and repair it as needed till paid off

[@terebrate]

Feeling good with my couple of 20+ year old Toyotas with 200+K miles that run great.

[@llcross04]

And then keep it forever

[@roberts.3712]

Laws in many states actually protect the dealers. It is called lobbying. In my state a car manufacturer must sell through a dealer....no direct sales allowed. Money talks BS walks.

[@Barbarapape]

A classic example of greedy dealers overpricing cars and buyers with more money than sense. As said it will only get worse as the buyers that paid too much seek to trade their cars in. Here in the UK it has been going this way for many months, EV's are the most affected with dealers offering very low trade-in values as they can't sell the ones they have and don't want any more.

[@LeadStarDude]

How do you handle all of this mess? You pay someone to repair your existing vehicle when it needs it. You take care of what you got, and you let all of the idiots deal with this mess. I just put a new motor in my 19 year old truck, and that cost me way less than even buying a decent used vehicle. All of the repairs and maintenance I have done over these years comes no where close to the cost of a used vehicle now days. Also I have confidence in this vehicle that I know so well. Confidence that doesn't exist in today's overly advanced electrical mess. I trust my 2005 model. No one can trust anything manufactured after 2019. They have recalls and electrical glitches every time you turn around.

[@GeneralChangOfDanang]

While I mostly agree. I live in the rust belt and my car was about to fold in half. BUT, I didn't go out and buy a $70k pickup. I bought the cheapest sedan that I could find because I knew everything was overpriced and they would have a harder time hiding fees in the price of a $20k car. I really don't understand people buying luxury stuff and overpriced SUV's right now.

[@brianasbury8315]

Yup that's what I try to do. I'm not a mechanic, but I try to do as much maintenance on our vehicles as I can, like changing out my own oil. (Express oil change places charge a fortune and they try to upsell you like the greedy dealerships. Changing your own oil and doing as much maintenance as you can is much cheaper and much more satisfying. Plus you know for sure the exact oil and filter that went into your car because you poured it in yourself.)

[@m8bagger792]

⁠@@GeneralChangOfDanangI’ve never understood why people have done it for as long as I can remember, my hair color is grave yard blonde 😳

[@briankirkman2891]

I’ve got a 2015 ram and I’m gonna ride this thing for as long as I can. At this point, I would rather just keep paying for the necessary repairs than add a car payment to my life. Thankfully, I’ve got an uncle who is great with cars and we’re replacing the oil cooler next week. All it cost me is just a parts because he does it for free. Going on three years now with no car payment and loving every bit of it!

[@wesshemwell9727]

My 2011 Ford Flex is pure gold. other than a new front rear suspension and a steering column runs great, doesn't burn oil and is a great travel car @ 172k mi and counting.

[@briankirkman2891]

@@wesshemwell9727 I’m sitting around 260,000 miles on mine but I do a lot of driving between work and personal. I’ve had to replace the shocks, the brakes, a couple of radiators because they tend to crack after a while. Currently have a Freon leak that I’ve chosen to just let be ha ha because that’s something my uncle can’t do and the leak is apparently behind the dashboard. So that’s a few thousand dollars worth of work that I’ll just deal with no AC for the time being. But I’ve learned so much about my truck that at some point when I do go to get another vehicle, I’ll be very educated on exactly what I’m looking for and what I want.

[@RandomEvents_]

I build decks and fences and i just paid off my 2013 ram earlier this month. Ive had no issues. Just regular maintenance. The freedom from debt is going to keep me from wanting another payment until this truck runs into the ground. It has 170k miles on it

[@DanielBeard-bt7mn]

@@RandomEvents_ That's great! In the meantime, keep saving for the next one 😃

[@RandomEvents_]

@@DanielBeard-bt7mn that's the plan 🙃💪🏽👊🏼

[@michaeldemko8522]

Buyers should stop trying to trade out or trade up ever 2-3 years especially on ,what is common these days, a 6-7 year loan. buy the vehicle and keep it. A person who purchased a 23 model should not be already looking to trade it.

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[@guitarexpert2245]

Always buy a car 2-3 years old with anywhere from 20k-30k miles from a private party only! I live in Arizona there is NO Sales Tax buying from a private party. I buy either Honda (Acura) Toyota (Lexus) or Mazda only. They last forever. I'm 63 and been doing this for over 40 years. Sometimes you meet really nice people and don't have to deal with Car dealerships B.S.

[@anthonybatulis6516]

In 2000 I bought a new Camry and put 300,000 miles on it before someone hit my daughter. I then bought a 2004 Avalon from my sister in law. I am driving it now. In 2022 I helped my daughter purchase a 2010 Lexus RX 350. So I agree completely with what you are saying.

[@brianmaloney45]

No sales tax on a private sale is a huge win!

[@jkairi4]

​@brianmaloney45 Huge sales tax on private party purchases in California. California is not that good for private party car purchases. Way too many scammers, flippers and curbstoners. Also, to get 2010 Corrolla for 8K it's going to have at least 200K miles because everyone and they're great grandparents are trying to capitalize in this market

[@guitarexpert2245]

@@jkairi4 I get that for sure.

[@guitarexpert2245]

@@brianmaloney45 Yes, it saved me $2 grand.

[@JohnDoe-wy2py]

What is sad is that those of us that are fortunate enough to be able to pay cash for a new vehicle are penalized for not financing. The local Nissan dealer adds $1000 to the MSRP if financing isn’t arranged by the dealership. This same dealership adds $1000 if the customer isn’t trading a vehicle in. They can choke on it

[@puravida5683]

I bought my Toyota 4Runner, V8, Sport Edition new in 2006. It was built in Japan, and has 45,000 original miles. I still enjoy driving this SUV, even though it does not have all the new modern technology!

[@dogownrpenna]

So happy I paid my car off in February. I'm keeping it until the wheels fall off!

[@cormaro13]

Depends on what it is lol

[@inthego]

over valued over priced vehicles leads to negative equity? Who knew? -first the stimulant.. then the chaser.

[@spellegren]

We bought in on the Toyota Sienna Hybrid in early 2021, before the price spike. Purchased for $3k under MSRP, at 1.9% interest over 60 months. We've got the note down to $16k, so we have pretty good equity right now. We're in no hurry to trade in, but have started looking at second vehicles now that prices have started to fall.

[@KevinSmith-wr1sy]

And if they paid a dealer markup on that F150 they are so underwater they need a submarine to survive.

[@EddieJazzFan]

We need more low end cars to get from point A to point B with out all the tech BS like heated seats and 11 USB outlets inside the car. What happened to the bare bones Civic or Corolla?

[@BlackDiamonds615]

Its 2024 not 2004. thats what happened lol.

[@wildbikerbill6530]

People got spoiled and voted with their wallets that they don't want a basic car, they want loaded. Of course, no surprise, they complain long and loud about the price of loaded.

[@lot2196]

Agree, I drive a 2017 Honda Fit. Boring but a really good little car. I hope to keep driving it for 10 more years.

[@tonysterbenc]

From the reports I read, the bare bones Corollas are still often selling at thousands over MSRP after dealer add-ons, especially the hybrids.

[@imviben4189]

Thanks pops for the lesson on negative equity.

[@admorris11]

If the customers are dumb enough to do it, it’s no one’s fault but their own. As much as I can’t stand dealerships, this isn’t their fault.

[@jonathantaylor6926]

It used to be trading in your 2 or 3 year old car for a new one cost little to no extra money. Especially when 48 month loans were more popular. People had decent equity because the car was mostly paid off. Many people have no problem with a perpetual payment so long as the payment remained the same (or maybe 20 bucks more) nobody cared. They bought the car. But after years of ADM's and 72 or 84 month loans there is no equity. And now rates are higher. The same transaction that used to hardly affect the payment could now double the payment and most people can't do that.

[@johnhinant970]

Keep sharing the good information.

[@eppyz]

I read an article in a car magazine a few years ago (pre covid) stating the average American family keeps their car for 3 yrs before trading it in. You take into account currently, the average American household earns $74k a year, the average new car purchase price is $45k, the fact that most financial planners recommend spending NO MORE than 30% of your annual income on a purchase price of a vehicle. So basically, we "average" Americans can afford a $22k car, but the new car average price is $45k. See the problem here folks? Add in average interest rates these days on car loans is 7-9% and 75% of people put less than 10% down on a new car? Its all a recipe for financial disaster. We Americans just spend too much on things we really can't afford. We always have to have the newest better thing or gadget and its making us poor, not wealthy. So buy your car VERY wisley. Buy what you can AFFORD not what you WANT. That money you save can be put to help build your wealth by paying off debt or investing in something that accumulates compound interest. You will be happy you did down the road.

[@henrymatthews9365]

Man you should look at the audi etrons depreciation. Its staggering

[@jonathantaylor6926]

You can get an $80,00 MSRP Tesla with 75,000 miles on them for like 16 grand. That what a used Toyota Camry would cost with those miles but they MSRP for like 38K.

[@SgtGnome]

I bought my 2013 Scion iQ brand new in Nov 2012. Still drive it today. Had it for 11.5 years and runs beautifully still.

[@cormaro13]

Sad lol

[@Bizzair1990]

It'd because people are buying 65k vehicles that should be priced at 38k. Why anyone is buying a 65k vehicle to drive to work and the grocery store is beyond me.

[@beachside1]

Ray and Zach I stumbled across a video that was constantly naming facts and stats from your company CarEdge. The video was called 10 Electric Cars that Dealers Can’t Sell ! | Here is why! and the author was called The suv geek. Not sure if you knew it or not, I just thought it was cool seeing your company name. Btw love great videos as usual.

[@stevemensen8325]

I noticed this 2 weeks ago. Last year I bought a used 21 F-150. Sticker was $53k, after negotiation (learned from you guys since 2020) and down payment I was out the door for $43k. Decided to check retail for fun 2 weeks ago and my truck is worth only $38k. Luckily, I'm not negative equity; barely. Very uneasy feeling still though.

[@Silverspank1969]

Duh…All vehicles are/have negative equity, some worse than others. The car industry used to be low vehicles prices at higher interest rates, then it switched to high priced vehicles with low interest rates. Now we have high vehicle prices with high interest rates.

[@peterkeegan531]

This is pleasing on many levels.

[@AutoAuctionUSA]

Wow! This negative equity stuff is brutal! Never thought about it like that with the Mazda CX-5 example. Those upside down payoff events sound shady too. Sharing this so my friends can avoid this car buying nightmare! Car Edge, any tips for getting out of negative equity besides paying it all off? 🔥

[@kurtkalenberg7454]

Nice resale value on the F-150 lightning. I'd be surprised if they even get that much for something nobody wants. 😂

[@markadler8968]

I agree. That truck is basically worthless.

[@voxel999]

Lightnings are moving off lots now since Ford has provided $7.5K to $10K in incentives. I’ve tried to buy a few but they get snatched up within a day. It’s crazy but Broncos are stacking up on lots now. 30% sales YoY decline. Dealers are discounting them $5-7K to move them.

[@nathanielpreble5108]

I disagree that the average person gets a "different" vehicle every 3-4 years. The average person can't afford that? I don't enjoy new cars knowing how fast it depreciates once it leaves the dealers lot. I buy my vehicles knowing I will keep it for at least 10 years. I have currently 1 car payment I bought in July 2021 then received in September 2021. I had to pay MSRP but I knew I'd keep the car a long time. Love my 2022 Corolla SE 6 spd manual.🤯 yes a manual it's the only way to drive a small car imo.😀

[@guitarexpert2245]

That car will last forever.

[@OemFreek]

What’s your payment and how year term?

[@atlantasailor1]

I have a 2001 Miata and it does not have all the junk electronics new ones have. Runs perfectly

[@Waaterbottle]

Hearing you say "inconceivable" reminded me so much of Wallace Shawn in Princess Bride!! 😂

[@adrianowallin]

hmmm, I've been shopping for a used vehicle, and I'm finding big and small used car lots are still not willing to negotiate price other than what is listed.... Rather than negotiating with me, I find they are out reaching to online retail sales that mirror carvana..

[@BuckRogers2000]

I admire and respect your whole business model. I await the verdict on the "crash landing". I worry for our youth!

[@mrt3206]

I can say that I have a 2022 Honda Civic Hatchback EXL with 12k miles and as soon as my second year of leasing ended a month ago Honda sent me a message and wanted me to trade my car in and they gave me $1500 in positive equity to terminate my lease🤷‍♂️ I didn’t accept it because I didn’t want anything they had but the offer was on the table👌 and I do remember paying a 2k markup on it so the fact I have 11months until the lease is up and still have positive equity is good news for me.

[@cormaro13]

It’s not really positive equity… just an incentive from the dealership to get u into another car lol

[@truckinfool3550]

I’ve only bought two new vehicles in my life, in 1986 and 1995, and haven’t even had a car loan since 2009.

[@jimmulderig743]

Good stuff guys

[@theeconomist100]

wow what acheviement!

[@jkairi4]

I drove my car until the wheels fell off, now what😢

[@761jared]

Same, though I didn't buy my first until 1993. But my last payment was in 2016 while I watch other people but a new one just before, or shortly after, their payments are complete. A constant cycle of debt, despite not needing it.

[@cormaro13]

That’s sad , must be living life pay check to pay check 😂

[@rsos8541]

Great job guys

[@Mike81438]

A higher percentage of vehicle manufacturers have moved their production to Mexico, check the window sticker. With "cheaper" labor assembling the vehicles, this answers the question about the obscene profits reported.

[@bill7481]

Some people didn’t have a choice, so they had to buy a car with markups. But the rest of them were asking for it. Too bad. Why do they think the dealer sold them a gap insurance on top of that markup? Duh! I hope the government doesn’t decide to bail out the auto industry when the sh*t hits the fan!

[@robertpoorman3531]

Inconceivable!!!

[@marklytle7829]

It’s inconceivable. “I donot think this word means what you think it means”

[@Billblom]

Fellow on you tube was moaning about his Porsche Taycan that cost him about 120,000 pounds... when he wanted to move to a 911 petrol car, the offers were in the 20,000 range for his dealer serviced vehicle. And the Porsche didn't want his car because they had several trade ins already, and they were not selling... Even at 20-30,000 pounds.

[@DABK2024]

looking forward to all the stories of people not understanding they couldn't afford their mortgage and its the greedy banks fault even though we saw pretty much this exact same thing in 2008.

[@tyneggs3792]

I love the rhyme! Lyrical genius

[@reloadNshoot]

The blame is the individual , afterall they signed the contract. Its just hard to beleive that some people cannot do simple math or understand that if they owe money on a vehicle it gets added to the current deal. There is no magical fairy that makes the money you owe disappear.The same mentally is used where welfare money comes from the government.

[@georgeniemi8259]

I am happy with my 1997 f-150 for now it has never let me down since I bought it in 97 everything still works including the ac / of course had a recharge in the mid 2000's /paid off 20 years ago

[@jschucke]

I think you mis-spoke. With $6,064 negative equity in your example, the payment goes from $590 up to $698, an increase of $108, not $140. Thank you for what you do to educate people on the car buying process. I have learned a lot!

[@pugowner1347]

LOVE the Wallace Shaw picture on que with "inconceivable". I wouldn't buy a car made after 2008, the year of my current truck, anyway. Too much unneeded garbage. Every car I've owned except one, I kept for at least 10 years. Still have my first car. 1969 Cutlass 442.

[@vincer027]

I like the title. But the blame is not on the bank so the dealership. Is the individual who signed the contract . No one else has to blame. This channel gives great context 😮

[@Sight-Beyond-Sight]

It feels so nice to have no car payments. Sure, my cars are aging (2010 & 2015), but they are still in GREAT running condition. I will wait for the repo market to get juicy if not snap up a new car on a fire sale.

[@S2NAZ]

Oh My God!!! That’s who your dad sounds like! I thought his voice sounded familiar then seeing that princess bride photo it hit me! inconceivable! 😂 Love the humor and the show ✌🏻👍🏻

[@3blenders]

Gap Insurance: can the dealer and or gab insurer cover that negative equity upper? please elaborate

[@dopplegangre]

That is wild about the lightning!

[@jonathantaylor6926]

That is bankruptcy level depreciation lol

[@denisfonaryuk7990]

I don’t know where you guys get all this information but here in Washington dealers still want markups. Went to a local Lexus dealer and they wanted a 7k dealer markup on 44k MSRP vehicle

[@davidr4716]

March 2021 needed a car. "Wanted" a Totota RAV4 Prime but no discounts - MSRP + $$$ 2021 Prius Prime: $4000 Factory Cash, $2,500 Dealer Discount, CA Clean Fuel Reward $900, $3,500 CA Rebate, $4,500 Fed Tax Credit. Bought the car I "Needed" not the one I "Wanted". Credit Union Financing at 2.24% $0 Down. Yes, timing helped. Discipline too. And lots of reading online. And some Rolling Stones advice😊 I have a Gas car with 550 mile range and an EV with 30 miles range in the same vehicle.

[@ItsABassDammit]

Tried to buy a 2020 Volvo V60 the other day, dealer told me that 13% APR is a competitive rate and due to the borrowing market single-digit rates are non-existent. Also told me the price is non-negotiable and they didn't accept outside loans. Told them to eat shit and left.

[@user-tz5gm4rj7f]

I’m curious if the lower amount of people turning in negative equity makes me wonder what is going on with repossessions. This will impact on who can purchase a new vehicle in the next few years. Is there any projection data on how many are going to just pay that enormous amount through duration, keeping them away from a new car?

[@izaiahDzz3080]

I had 9k of negative eq (its was a 2018 Compass) got lucky dealer still payed off the 22k loan ,🎉got a new deal 2k over msrp, but i took it just to get rid of that nightmare

[@Galileo9.81]

yep! My Model 3 and Y are under the water even after we bought them in the early 2021. EVs in general are at the lowest demand and the interest rate is VERY high. Plus, people with low income are struggling and their credit card bills are maxed. My car payment and insurance premium are just about 10% of my take home salary monthly, and the low interest rate I got back in 2021 is just about right for my family. I am not giving up that interest rate for another 3+ years for sure. Cars can't be an investment in general but it just sucks that I can't switch to another Tesla or Toyota. Who to blame? Just myself.

[@nycrich139]

Car insurance has also increased substantially this year. Both my brother and myself have received 30% increase from GEICO this year. No claims and good driving records.

[@jjourdan8014]

I would shop around, I saved a lot on my insurance. Geico was one of many insurance companies who raised rates over the pandemic.

[@wfs000]

Used to call this "being upside down". Local financial expert always told audience to never have a vehicle loan > 4 years.

[@stevemccooleq]

Best way to handle negative equity. Understand that like it or not you made a commitment to that vehicle. Keep driving it and pay off the loan.

[@MrBadintentionszw]

Just dealt with this yesterday luckily it was only 1K but still I was floored that I had negative equity

[@cormaro13]

😂 you must be new to this world

[@michaelmoreno8023]

This is a consumer market.. no one has to point fingers at so and so. It comes down to the customer wanted to buy a vehicle to keep up with the jones and not being able to afford it and quickly realize that and they put themselves in a worse spot. Banks or dealers are simply presenting numbers to them and it’s the customers decision to sign the contract.

[@TheCryptoRx]

Whoever thought to put the Princess Bride photo up. You are an editing guru!!

[@sallytorres6574]

Where can I get a sweatshirt like what Ray is sporting?

[@smeador00]

Play stupid games (buying way over priced vehicles the last couple years), win stupid prizes (neg equity). I will say though, I keep hearing Ray say “you (meaning dealer) put the customer in this position..) While I don’t necessarily disagree, let’s not forget people make their own choices and decisions. Stop buying shit you can’t afford, people!!!!

[@mikejosephson2594]

That is the average, is it balance out against all trades or just negative equity ones

[@m-cw7er]

2016 Subaru Outback. Bought brand new. 73K miles. Golden for a while.

[@TeslaEVolution]

This is NUTS, but it is true! Even Teslas are getting bottom feeder prices now. Less than HALF of what they traded for about 12 moths ago.

[@761jared]

I was recently talking to an older lady, telling a story about her adult son. He wanted a new Tesla in Atlanta, but they wouldn't take his older model as trade. He cancelled his order and bought a hybrid instead.

[@Columbus1152]

We have a 2015 KIA Optima EX, I was considering to trade in around 2020 when it was paid off, of course with the pandemic supply chain problems cars were scarce and then dealers got greedy. Trade in values were great but that didn't offset the gouging they did. So our car has been paid for since about 2020, the trade in value for it has dropped and isn't much against a new car, we've kept it up and it's still a great car. They created a situation that forced us to look at the practicality of overspending to get a new car vs staying with what we have and saving a ton of $$$$.

[@cormaro13]

Maybe change brands like to a Mazda and u won’t be finding that issue lol

[@Columbus1152]

@@cormaro13 I like Mazda too, we've had them for a rental a couple of times, also like that they still offer a non turbo engine.

[@cormaro13]

@@Columbus1152 get 2022 or newer , that’s sucks , if you’re close to the border , u can try crossing over or use a dealer negotiator if u don’t wanna deal with any of it

[@michaelmcmurphy3781]

Been driving the same car 17 years and wondering when these people are going to learn.

[@steveshutt6409]

If everyone did what you did car companies would go out of business lol.

[@andrewamenard]

He said the word. He said inconceivable. He really is the Vizzini of the car dealer world.

[@TNCowboy2012]

I wonder if my 2024 Rav4 Adventure scheduled to built in Ontario on April 9th will be delayed by the bridge collapse?

[@darylb5564]

This is NOT a crisis. If the person just bought a vehicle they don’t need a vehicle. Just drive the car for a few more years and then get a new car

[@brianasbury8315]

Not even a new car. A good used car that's affordable. Most people don't need a brand new car. Unless you got the dough to pay for it outright (most don't) it'll put you in the poorhouse.

[@stephenmcdonald8218]

If it gets wrecked gap insurance should cover

[@diannacook3514]

I'm saving for new vehicle. I plan on having a nice down by Dec. I hope my now vehicle last that long.

[@cormaro13]

Depends really on what you’re getting , let hear it

[@holdmybeer2955]

Had to buy new vehicle in 2021, overpaid but at least I paid cash and am not upside down on a loan. The vehicle depreciated a crapload though.

[@jwarnstarsmile]

I did get a small deal on my purchase last August. I made a reasonable offer based on my budget and they met me there. It was about $2300 after tax under what it would have been.

[@JeffandLeslie]

The 2 big problems I see here: 1) Dealership greed, 2) people thinking they need to trade into a new car after 3-4 years. Any new car (possible exception of CDJR and Hyundai - joking about these brands) should give you 8-9 maybe more years of trouble free service. Then you've 4-5 years of no car payment, you're no longer upside down and you got your money's worth from the new car you just bought. I like new cars as much as the next guy. However, I like my money more.

[@r.weaver3769]

I bought a new car once, in 1982, the dealer twisted figures around and on paper to look like they gave me more than my old car was worth because I wouldn't buy unless they gave me X, NOT, the juggled the figures on contract to make it look like they gave me that much. But then the car turned into a lemon, was in the shop 5 times for the same issue, I drove two weeks out of two months of ownership, they bought the car back, and had to give me my trade in money back. Remember twisted numbers, yeah they took it up the ___. I never bought a brand new car again.

[@cormaro13]

Wow so little baby had one trouble time at the dealership and now won’t buy a new car 😂