dklanecky1

I recall my Dad telling me that Sears made more money on the financing than on the product they were selling, and got people thinking about just the monthly payment amount, and not what they were actually paying over time.

Kind of the start of all the consumer credit issues a lot of people still have today.

LexFinally

Right. As I think we're all aware, the car salesman always wants you to think and talk in terms of the monthly payment rather than the price. I had a frustrating experience recently trying to advise a friend who was shopping for a car. They were doing this exact thing, and I was unable to make them understand that the same monthly payment could happen across an almost unlimited range of real price points, because the dealer can simply give you that nice low payment for a million years.

Now that you got me started, it's an index of our sinking living standard that the average payment duration has now stretched out to 6-7 years. I'm preaching to the converted because this is a board of Toyota/Lexus buyers, but can you imaging taking out a 7-year loan for a GM or Chrysler or VW or BMW product? That's not under water, that's the bottom of the ocean.

glamglam

The 6 and 7 and even 8 year length of these car loans will definitely make the owner upside down in the vehicle all the way through the 5th to the 7th year if they want to sell it for another brand new one. They all end up “rolling” the debt from the original loan into the new loan getting them deeper in debt.

mikemu30

Yep I know a financial genius who now owes roughly $65K on a $50K vehicle. Flips his car every two years or so and the dealer scams him into this every time. "my payment didn't change - what a deal" HHHHHmmmmmmmmm you gotta wonder.