Those who have heard some bad news from their mechanic in Urbancrest, Minerva Park, or Georgesville should call our auto buyer. If your car costs more to repair than it is worth it is auto junk—those in Brown, Norwich, and Perry should call. Many vehicle owners with serious mechanical issues on older cars aren’t aware that we buy junk cars in Plain, Sharon, and Lincoln Village. Are you there in Amlin, Clinton, or Groveport going to replace a transmission for over $2,000 on an 11 year old vehicle when we buy used cars for scrap. We are an environmentally sound car scrapping option.
On November 27, 2016, Greg Gardner of the Detroit Free Press wrote an article with these details: “The trend toward easy credit and longer auto loans terms has left a record number of consumers trading in cars that are worth less than what they still have due on their loan. This situation is commonly referred to as “being underwater” or “upside down” on your loan. They already are having some effect as automakers heighten incentives and sub-prime lenders watch their delinquency rates. In 2016, a record 32%, or nearly 1/3, of all vehicles involved in trade-ins at U.S. dealers belong in this category. When the consumers go to purchase a new vehicle they must add the deficit between their loan balance and the vehicle’s value to the price of the new vehicle they wish to buy.
The lowest the “underwater” percentage has been historically was near 14% in 2009, amid the Great Recession when credit was hard to obtain. Previously the high was 29% in 2006, when the housing market was in bad shape. The average new vehicle loan is for 68 months, according to Experian, which tracks this stuff. Sub-prime borrowers, those with lousy credit scores, are borrowing over an average of 72 months, or 6 years.
While those loans limit monthly payments, they also hurt the buyer’s equity, or amount of the loan principal paid off. Rather, it expands more slowly than the vehicle depreciates. If the car gets stolen, or wrecked, or you really want to buy a new car while you’re upside down then it is a problem. This happens as the average retail price of a new car is near an extraordinary high of about $34K. Some of this increase is spurred by consumers’ preferences for bigger, fully equipped pickups, SUVs and such. The result is they borrow more to get the car they want. The average new vehicle loan was $29,880 in the 2nd quarter of this year.
Leasing is now at record levels of more than 30 percent of all sales, has grown increasingly popular. Already, especially in segments such as compact and mid-sized vehicles, used car values are dropping as a wave of three year old vehicles are returned from lease. This uptick in supply is forcing down the amount dealers are enthusiastically willing to pay for these at auctions. Ford CFO Bob Shanks told people that their Ford Credit segment cut its forecast for 2017 profits because due to drops in auction values for used cars. Moody’s, Standard & Poor’s and Fitch, have expressed some concern about the pattern. Their focus is on the $38B market for securities based on auto loans. These are bundled auto loans, similar to the groups of mortgages that fell in the 2008 crash of the mortgage bubble. History indicates borrowers are likely to remain recent on their car loans compared on their mortgage payments when the economy weakens. Banks can cars quickly versus a mortgage. Fitch says that delinquencies of over 60 days on sub-prime vehicle loans rose to 5% in September, the 2nd highest level since 2001, and higher than last year.” The full article is available here.
Columbus Region Scrap Auto Buyer
How much longer will you leave that broken down car sitting there in Galloway, Hamilton, or Reynoldsburg before calling an auto buyer? There is no need to proceed further to sell your auto junk in Montgomery, Mifflin, and New Rome—we will haul it away. Where is the nearest site that will buy junk cars in Lake Darby, Whitehall, or Worthington, OH? Those in possession of an unwanted vehicle in Lockbourne, Marble Cliff, and Harrisburg should be aware that we buy used cars for scrap. Were you aware that used oil can be recycled, purified and then used again, another example of renewable usage.
