Jmm722
Distinguished Member
- Joined
- Dec 26, 2013
- Messages
- 7,292
- Reaction score
- 12,464
People typically finance 60 months, prices won’t be elevated artificially for the entire time period. People typically default after a couple years. So in 2-3 years you owe $40k on a 3 year old GTI, when a new 2024 GTI retails for $42-$45k. Even if the bank repos it, the used value is likely $25-30k.How is this different from the normal crazy depreciation from a normal default. (Example - you default on a $50k financed car that is only worth $35k 9 months later) Dont banks cook this into their financing and risk? Isnt the default/repo better because all car prices are way up?