Topic: Upside Down Major

[.l..]

That's just nuts!  I've never owed more that $56k for anything other than mortgage debt in my life and even then I paid it off asap.  Having debt freaks me out! I don't know how some people sleep at night.

Agreed.

You are lucky! My generation will never experience that....if only I could buy a house for $100k....I'd buy a few in cash!


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Wait a second...you got a new 2016 Ford Explorer?  Where's the show and shine then?

Lol I am discreet...but I can take a couple pics this weekend - assuming the weather won't be as shitty as they are expecting

You could buy a few houses at $100,000...cash (braggart!  ) and you buy an Exlpoder?    No mo SHO?

[dkaz]

You put down enough of a downpayment that you were likely never upside down on the loan, or maybe for a few months at most.

[Cord]

Dude owes $54000 on his 2011 truck. It's worth $31000 on trade. He's paying $490 bi-weekly now. He says all he can afford now is $200 bi-weekly. We showed him the math of that scenario. Poor bastard started crying right in the office.

Terrible thing to see.

[SaskSpecV]

Cord, in all of these stories the owner must have been rolling over negative equity from previous purchases, right?  I mean, in the last example, how can someone paying $1000+ per month on the vehicle still owe $54000 on it after 4+ years??  Or was this 10% interest rates or something?

[dkaz]

Dude owes $54000 on his 2011 truck. It's worth $31000 on trade. He's paying $490 bi-weekly now. He says all he can afford now is $200 bi-weekly. We showed him the math of that scenario. Poor bastard started crying right in the office.

Terrible thing to see.

So he has about 5 years remaining at $490 biweekly.

$200 biweekly will pay off his negative equity in 5 years.

[Cord]

Cord, in all of these stories the owner must have been rolling over negative equity from previous purchases, right?  I mean, in the last example, how can someone paying $1000+ per month on the vehicle still owe $54000 on it after 4+ years??  Or was this 10% interest rates or something?

This guy had owned it for less than a year. So there was definitely prior negative equity.

[tooscoops]

two today went for the deals against my judgement.

wrangler owing about 13k more than it is worth. a buyer who only looks at payments, so had done this twice before. high km driver and doesn't care for them (jeep was making a noise, so put it in the shop to evaluate... only has 2L of oil in it and it was not looking good.) 12% loan on the last one, so have him submitting a new 0% loan... i'm sure it's a waste of my time, but it would at least start to melt the snowball he has started... already told him if the loan is anywhere over 5%, just start taking better care of your jeep and we'll tear up this contract...

escape that is not even two years old... unfortunately she bought the exact model that rental companies love... a quick check shows that if i put it on my lot, there will be 183 nearly identical ones within 100kms of me... she thought she had paid off more than 3 years... i asked her... "how?... it is a 2014"... "oh... i don't know"... so had her call and her loan is almost double the value of the car (-15 equity). but all she cares about is payment... only goes up 50 bucks.... every two weeks... for 8 years. wouldn't look at used, wouldn't look at less vehicle.

oh, and another i had... not a negative equity, but i'm sure i'll be talking about him in future... got preapproved from his bank, so is going to buy a loaded used rubicon... over 40k after taxes... asked for a deposit, but he couldn't come up with 200 because his credit card is maxed out and he has no money in the bank. see you in this thread in a year or so!

[revalations]

This thread makes me kinda miss working at a dealership dealing with vehicle shoppers. 

[KD]

Man the world is just full of ten cent millionaires.   

Last week I was waiting for a rigging contractor crew from Nova Scotia to show up to mount an antenna on one of my towers.  They foreman called me when they were about 1/2 hour away so I got there just before they arrived to open up the gates for them. The site is way up on a hill like most and the approx 1/2 km access road is winding and lined with trees so you can't see anything coming up until the last few feet.  Soon enough I hear these roaring noises getting louder and in pulls a Harley Sportster followed by this huge jacked up newish Titan with huge mudder tires, crazy suspension kit, and obviously lots of engine mods by the sounds of things, and following that was the big 4-door F-550 rigging truck pulling the big cargo trailer and just one guy driving that. 

These guys are on the road a lot and the foreman said he brought his Harley because he hasn't had much time this summer to drive it, but the dude in the Titan just wanted to drive himself because he just likes to drive. It's about a 450 km drive from where they are based and most of them live quite a distance from their base office. The guy in the Titan was in his early 20's and barely spoke.  I asked the foreman what the story was on him and he told me that he had just got back from Alberta where he was making big bucks as a rigger and brought the truck back from there with him where he bought it brand new last year.  It had a over $10k in suspension mods alone and lots of bucks for tires and engine mods none of which he did himself.  I'm sure that thing probably burned at least $200 in fuel just getting to the site, then they were heading another 200 km or so further north to the next jobsite after they were finished with mine, so another $100 more in fuel. These guys make half decent money, but I'm sure this guy is pissing it away just as fast.  They dont get paid for mileage as the work truck is provided for transportation. The foreman was smirking away was he was explaining it as he sees these guys come and go on a regular basis. 

I guess it's stories like these that are the genesis of this thread.   

[Solstice2006]

Cord, in all of these stories the owner must have been rolling over negative equity from previous purchases, right?  I mean, in the last example, how can someone paying $1000+ per month on the vehicle still owe $54000 on it after 4+ years??  Or was this 10% interest rates or something?

This guy had owned it for less than a year. So there was definitely prior negative equity.

Owned it for less than a year, and wants to trade it in already??

[toolatecrew]

I expect to see a huge spike in these things in Nova Scotia. No Jobs in NS..that's fine all the youing 20 year old guys just move out west and make big $. Away from home for first time buy a big jacked up brand new truck. Wait... the oil jobs are shut down? Well pack up your 60K truck that you financed at 0 down for 84 months and drive home and move back into mom and dad's basement. wait...still no more jobs in NS than there were before?  All those trucks have to go somewhere:-)

[tooscoops]

so the good news is that the bank said no way to the kid trading in the jeep....

the lady's significant other decided to get out of his lease a touch early and take a used model instead of new so she can keep the escape...

and the jeep... well.. it's still going ahead.

[Cord]

^^ 

In other news, a guy tried to trade in his 2014 Ram in order to lower his payments. Truck was worth $33000 but he owed $61000. We won't get that trade.

Another customer wanted an appraisal on his lifted, modified Super Duty. We told him it was worth $45000 to us. He asked if that was a joke and said he wouldn't take less than $62,000. We never did find out what he owed. Or did we? 

[johngenx]

^^ 

In other news, a guy tried to trade in his 2014 Ram in order to lower his payments. Truck was worth $33000 but he owed $61000. We won't get that trade.

Another customer wanted an appraisal on his lifted, modified Super Duty. We told him it was worth $45000 to us. He asked if that was a joke and said he wouldn't take less than $62,000. We never did find out what he owed. Or did we? 

These don't surprise me anymore.  Which is terrible.

[tooscoops]

it really is terrible... a glimpse into what kinds of financing minds we are cultivating today...

not an upside down issue, but we just had a little meeting about rrsp's at our dealership... could not believe how little anyone knew about math, interest and the realities of financing... i started talking about it with a fellow employee and came up with a half-assed conclusion that students don't learn about retirement savings in school because their teachers have such good pension plans, that they don't really (need to) know much about proper investments.

just had a guy moving out of the province and needs to do a quick flip of his jeep srt.... had intake, exhaust, blacked out everything... figured he was screwed... turns out he owes almost exactly what it is worth wholesale! man was i surprised.

[SaskSpecV]

^^ 

In other news, a guy tried to trade in his 2014 Ram in order to lower his payments. Truck was worth $33000 but he owed $61000. We won't get that trade.

Another customer wanted an appraisal on his lifted, modified Super Duty. We told him it was worth $45000 to us. He asked if that was a joke and said he wouldn't take less than $62,000. We never did find out what he owed. Or did we? 

These don't surprise me anymore.  Which is terrible.

Yeah, this whole thread should be a subthread of the "things that make me sad" thread. 

Maybe I should be more optimistic.  Perhaps this thread is helping educate someone out there that flipping a vehicle every couple years (and rolling negative equity) isn't a viable long-term financial proposition...

As for the modded super duty - lots of guys just don't understand why no one gives a crap about how much you spent on your mods. Especially for modifications that don't enhance the utility of the vehicle (ahem, lift kits, giant rims, ahem). Not only will I NOT pay you the "full value" of what your modifications cost, but the vehicle is probably worth LESS to me than a stock one.  Maybe someone will pay a premium for your modified vehicle...but it won't be me.

If you mod your vehicle, do it because you want to mod your vehicle - not with some asinine assumption that this will increase the resale value. (THere's some exceptions to that of course).  When I put a short-throw shift kit on the Elantra Touring, it's because I wanted a short-throw shifter on my Elantra Touring!  Ain't no one going to give me $300 extra for it when I sell the vehicle!

[Fobroader]

^^ 

In other news, a guy tried to trade in his 2014 Ram in order to lower his payments. Truck was worth $33000 but he owed $61000. We won't get that trade.

Another customer wanted an appraisal on his lifted, modified Super Duty. We told him it was worth $45000 to us. He asked if that was a joke and said he wouldn't take less than $62,000. We never did find out what he owed. Or did we? 

These don't surprise me anymore.  Which is terrible.

Yeah, this whole thread should be a subthread of the "things that make me sad" thread. 

Maybe I should be more optimistic.  Perhaps this thread is helping educate someone out there that flipping a vehicle every couple years (and rolling negative equity) isn't a viable long-term financial proposition...

As for the modded super duty - lots of guys just don't understand why no one gives a crap about how much you spent on your mods. Especially for modifications that don't enhance the utility of the vehicle (ahem, lift kits, giant rims, ahem). Not only will I NOT pay you the "full value" of what your modifications cost, but the vehicle is probably worth LESS to me than a stock one.  Maybe someone will pay a premium for your modified vehicle...but it won't be me.

If you mod your vehicle, do it because you want to mod your vehicle - not with some asinine assumption that this will increase the resale value. (THere's some exceptions to that of course).  When I put a short-throw shift kit on the Elantra Touring, it's because I wanted a short-throw shifter on my Elantra Touring!  Ain't no one going to give me $300 extra for it when I sell the vehicle!

I belong to a local diesel truck page and its hilarious how many of these young kids do not get that the vast majority of people do not want stacks, 14" lift kits, 40" tires and a slew of light bars and those all make your truck worth a hell of a lot less.

[valuator]

What strikes me the most is that vehicles today are built so much better, last longer, etc. that driving a new car for the long haul is a better deal than ever before.  Flipping cars every 2-3 years (or less) is getting more and more common even though there is less and less reason to.  Boggles the mind.

[johngenx]

came up with a half-assed conclusion that students don't learn about retirement savings in school because their teachers have such good pension plans, that they don't really (need to) know much about proper investments.

First, that is half-assed. 

It's not in the core curriculum and people are pushing big time for us to focus on the core - no time for "optional" stuff like that.  Math curriculum has been pushed down from university, so the focus in math now is on university preparation - not practical skills.

[Solstice2006]

What strikes me the most is that vehicles today are built so much better, last longer, etc. that driving a new car for the long haul is a better deal than ever before.  Flipping cars every 2-3 years (or less) is getting more and more common even though there is less and less reason to.  Boggles the mind.

More and more common?  What stats show that?

Years of ownership has been on the increase..

"The average expected life of a vehicle in the United States is 15.36, versus 12.88 years in Canada. Our weather plays a part, but so does psychology – many Americans are happy to drive a beater into the ground."

http://www.theglobeandmail.com/globe-drive/news/industry-news/canadians-vs-americans-top-10-differences-in-auto-ownership/article18800449/