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Cars are so expensive that buyers need seven-year loans
- toomuchtodo 1y agohttps://archive.today/zZXZq https://archive.today/zZXZq
- mikestew 1y agoEven TFA points out that this is nothing new, as I was thinking "we bought a new car 20 years ago, and 84 month loans were an option". It was an option that few took, but it was there. Now, apparently, 21% of new car loans are 84 months. While we're on the subject, here's one for you: if you buy an RV, you can get a 20 year loan. We technically have one at the moment (it'll be paid off after having held the loan for a few months). You think cars depreciate fast? Go buy an RV. I can't imagine carrying a 20 year loan on something that will be nearly impossible to sell before the loan is paid off.
- gentooflux 1y agoMarine loans for boats also appear to carry 10-20 year terms. Value being subjective and all, if you find the juice tasty enough then it must be worth the squeeze. Car loans have a bit more of an inherent predatory bent since most Americans need a car to get by. That's not to say we all need a car which costs so much that an 84 month term becomes worth considering...
- garciasn 1y agoBoats here cost the same as a car and more, but because they are used far less and have a high resale value (Minnesota has a lot of lakes and a culture centered around water and boating) it might make sense. I bought a 20yo pontoon for $10K and I could sell it tomorrow for $5K more than I paid for it two years ago. I cannot do that with a car. No way; no how.
- chung8123 1y agoDo RVs have a deprecation cliff since you cannot take old RVs to many campsites?
- MisterTea 1y agoI just looked that up and apparently there are 10 or 15 year rules enforced by some but not all parks. If the RV is older than 10 or 15 years it will be barred from entry. Apparently the rule is to deter people who do not maintain their clunker of an RV which might break down, leak various fluids or catch fire. The given advice is to keep your rig in good shape and call the RV park and explain the situation. They may request pictures as proof e.g. a well maintained conversion of an old city bus would be fine if your pictures show as much. Some parks might inspect on arrival.
- chung8123 1y agoIt seems like that would zap a lot of value. Just going through the uncertainty if your RV makes the grade after a certain time.
- kylehotchkiss 1y agoNew dream policy for California: no more 20+ year old RVs street parked in touristy places. They'll end up taking over entire streets around mission bay (a large park in San Diego)
- sidewndr46 1y agoThat's an extremely charitable take. Have you ever considered parks just don't want someone who can't afford a new RV?
- justinator 1y agoThere are some countries that don’t allow old cars on the road.
- Tostino 1y agoHave dealt with this. I own a 2007 RV. Maintain it well enough that it isn't an eyesore, but I'm not going to waste my life on upkeep. I have never been turned away from an RV park in the last ~6 years that I've owned it, even when staying at "must be 10 years old or newer" camp sites. Like you said, it's more used as a policy to turn away. People who the park doesn't think fits their vibe.
- evilduck 1y agoIsn't the 20 year RV loan for folks who make them their permanent residence? I think they would view it analogous to paying rent for an apartment instead of paying on a depreciating asset.
- justinator 1y ago20 year loan on something that depreciates that terrible is predatory.
- deleted 1y ago[deleted]
- hnpolicestate 1y agoYou will own nothing and be happy basically.
- ericmcer 1y agoEh cars are one of the few areas that haven't been crushed by inflation unless you buy some stupid giant SUV. Honda civic costs less than it did in the 90s/00s (adjusted for inflation). Tons of affordable sedans out there, people just like getting giant $50k+ cars, I have no clue why.
- pojzon 1y agoIn Poland I bought new Toyota Corolla fpr 127k pln after promotions (that was 2021). Three years later I sold the car for 142k. Adjusting car value, a 3years decrease, it should cost around 70k. But it doubled in price. So at least here inflation on new / few years used cars is around 100%. Its a terrible moment to buy used cars. You are way better off buyin a new car for 150-200k. Coz promos you get will drop its price by almost 30%.
- betaby 1y ago> Honda civic costs less than it did in the 90s/00s (adjusted for inflation) Adjusted to inflation Honda Civic costs slightly more today in Canada than it costed on 2015. I'm not sure that the median salaries grew at the same rate.
- dumbledoren 1y agoHard to understand why people are downvoting the parent. That may be a right wing dogwhistle, but also the entire corporate industry seems to be trying real hard to turn life on planet earth into a subscription.
- taylodl 1y agoThe real news is Harley Davidson motorcycles are so expensive people are getting 8 year loans at over 10% APR - and that's with good credit! Prices today are insane!
- madcaptenor 1y agoCars last longer now, so this may not be as bad as it sounds. The real issue is whether people are ending up underwater on their vehicles - that is, are loan lengths increasing faster than depreciation curves are flattening.
- MrResearcher 1y agoThe powertrain warranty is usually 5 years or 60K miles. Bumper-to-bumper warranty is around 3 years, I think. I would be OK with the loan for as long as powertrain is covered, at the very least. The modern day turbo engines have exceptionally low reliability, it will blow while you still owe quite a bit for the car.
- sidewndr46 1y agoI'll add a disclaimer here that I don't buy new cars or trucks, so this doesn't really apply to me anyways. My family's limited experience with powertrain warranties is that they don't mean anything. The manufacturer put a junk engine in my Dad's truck at the factory. When they replaced it, they replaced it with a junk engine. When confronted with this, the dealer claimed it was not reasonable for a replacement engine to run without issues. Neither made it 30,000 miles.
- 4MOAisgoodenuf 1y agoDo they really? I've seen plenty of surveys that say American consumers are _keeping_ their passenger cars for longer and longer periods (12.8 years in 2025 https://www.spglobal.com/automotive-insights/en/blogs/2025/05/average-age-of-vehicle-in-us https://www.spglobal.com/automotive-insights/en/blogs/2025/0...) But is there any study that says the components or designs are needing less repairs or are getting cheaper to maintain over that 12.8 year period as opposed to, say, an econobox sedan from 2005? Is a modern family car with GDI, CVT, plastic oil pan, infotainment system, and litany of safety sensors going to last as long without bankrupting its owner as an equivalent product from a comparable market segment 20 years ago?
- madcaptenor 1y ago
- htrp 1y ago96 and 120 are the next places, where you can roll your loan balance as part of your trade-in
- carlosjobim 1y agoMotorcycles are a great option for those who live in suitable climate and don't have to text and play Candy Crush while they're driving. You can complement with a cheap car for when you need four wheels, instead of going into years of debt for a decent vehicle.
- hoosier2gator 1y agoI don't trust other drivers enough to be riding a motorcycle..
- ChiefNotAClue 1y agoMotorcycles only seem cheap. Factor in a proper set of gear, like helmet, jacket, pants, and gloves, and you're up another $1k. Also note that maintenance intervals are more frequent. Consumables, such as tires, will be more expensive in the long run. Why choose that over a used car for $5k? It's not cheaper, nor is it more practical. But I'll agree, on the nice days, it's definitely more enjoyable.
- carlosjobim 1y agoAre you comparing a brand new motorcycle with a 5k used car? You can get a used motorcycle and second hand gear. No matter how you slice and dice it, motorcycle is cheaper.
- subscribed 1y agoIt is, even brand new one. I can find several middleweight tourers / adv bikes between £12k-£25k new. And that's middle/top shelf. I can even get something new under £8k if I don't need the most modern electronics and 650cc is enough. Comparing that to the car? LOL, 5 year used car like, say, Hyundai Ioniq is £15k+ And every other bit of the maintenance is more expensive in the car. Literally every single one. Also taxes and insurance. Gear? Yeah, boots once every 10-15 years, gloves/jacket/trousers/helmet every 5 years, Still cheaper.
- otterley 1y ago
- Figs 1y agoMeanwhile, China is making EVs in the $5~$10K (USD) range like Lingbox, BAIC’s Arcfox, etc...
- nicbou 1y agoIn 2020 I bought a "disposable" Renault Kangoo to schlepp things around and go on road trips. It broke beyond repair last week and I started looking for a replacement. Even a 3 year old Dacia Dokker - basically the same exact car with newer trim - is pushing €15k. A new Kangoo is around €30k. That's a lot for an economy car that does nothing significantly better than the 2007 version. Since I only drive 1-3 times per month, I decided to stop owning a car. The cost of ownership is just way too high.
- randerson 1y agoMy experience is that the base price for a car hasn't increased as much as all the mandatory dealer add-ons they force on you. I'm currently trying to buy a new car and the dealer refuses to sell me one without a Pulse brake light, paint protection, ceramic glaze, wheel & tire protection, floor mats, and prepaid maintenance, and I must trade in my current vehicle. Other dealers in the area all do the same thing. I walked out the door and they never called me back so I suppose this strategy works for them. Dealers have gone from adding zero value to adding negative value, and thanks to their lobbying it is impossible to buy a car without them.
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- tschwimmer 1y agoCar dealers are a scourge on Americans and a hidden tax imposed via poor legislation. They employ thousands and are generally very wealthy so regrettably they have become an embedded political entity. I don't know what the answer to them is other than to remove the anti-DTC laws but that seems unlikely.
- foxyv 1y agoIn a small town I used to live in, the car dealerships essentially financed the entire town. Their sales taxes paid roughly 80% of the town budget. The dealers could have murdered people in broad daylight and the sheriff would have handcuffed the corpse.
- 4MOAisgoodenuf 1y agoGiven the current state of many car companies (Nissan, Stellantis, Mitsubishi) a 7-year loan may be a bit over-optimistic about the future of the car and the manufacturer
- chung8123 1y agoI wonder if we shift to a more ebike infrastructure in the future.
- Tostino 1y agoSadly, that would reduce GDP by lowering spending. Can't happen. I'm slightly joking, but only slightly. I've built my own ebikes since I was a teen in the 2000s. I love them, and wish more people would use them to get around day to day. There has been such a lackluster or hostile adoption by "the powers that be" of them, I just can't see it actually making a difference in American transportation though. At least we aren't the UK though. They have been so hostile to ebikes and escooters for a couple decades now I couldn't imagine bothering if I lived there.
- j45 1y agoSo expensive.. or so profitable that the payments need to be lowered to look palatable over 7+ years.
- otterley 1y agoOne important reason is that the US is imposing significant tariffs (25%) on Chinese-made automobiles. You can buy a very nice car just south of the border in Mexico starting at MXN$300,000 ($20,000 USD).
- 2OEH8eoCRo0 1y agoTIL the average consumer makes horrendous financial decisions. God forbid you buy used!
- JojoFatsani 1y agoA lot of people have too much car for their needs. Big Child Car Seat is definitely driving some of the growth of vehicles, as is quite reasonably priced gas, but I feel most people could go smaller/used and afford what they actually NEED vs WANT.
- subscribed 1y agoFrom my friend's search "three child car seats in the back" were rather exhausting experience.