Topic: What would you say to government regulated auto loans?

[aquadorhj]

http://oppositelock.jalopnik.com/government-says-10-downpayment-required-on-auto-loans-1486177241

what do you think ?


coles note : gov proposes to limit new car loans to 10% down mandatory and 6 years max.

[redman]

I think the industry should do this, but since greed is the biggest motivator is greed maybe the gov't should impose those rules. I agree that some personal finance teaching should be part of the school curriculum. Ego seems to get people in debt. People do need protection from themselves. 

[safristi]

They (Gov) regulate our largest purchase ,a house, with strict mortgage requirements
 so no surprise they are going after the 2nd largest purchase a car....soon we will need
 a loan for comestibles  (food) the next on the list ........


 Vote for me  FREE BEER in Every Man Cave....cheap wine for the broads

[mmret]

Some basic personal finance education as part of the school system would probably be better. But I suppose you do have to protect people from stabbing themselves sometimes.

10% and 6yr max doesn't sound too restrictive. Probably wise.

[Sir Osis of Liver]

It's probably a good idea. They should also prohibit rolling the balance of loans over into a subsequent purchase.

Personally, I'd be more interested in having the window sticker be the on-the-road price. That would take much of the headache out of buying a car.

[Northernridge]

You lost me at "Government regulated". So, no. Just no.

[Sir Osis of Liver]

You lost me at "Government regulated". So, no. Just no.

Yeah! Except for clean water, clean air, safe food, safe medicine, safe cars and highways, what has the government ever done for us?

Let the market solve air pollution!

[ArticSteve]

This has nothing to do with protecting consumers from themselves.  It's about securitization of debt sold as something it is not. 

How is something like this going to pass in a country were in 20 or so states lenders can charge 25% per month on Car Title Loans.

[PJ]

Even if they try to control auto loans people could just put 100% of the cost on a home secured line of credit and pay it over decades. 

mmret has a better idea, make education in finances a standard course in schools.

[Snowman]

70% of the population requires protection from themselves. The blame rests with the institutions who prey on these 70%. If I took the money the bank wanted to give us when we first moved to Oakville I would be living on Lakeshore Drive, fackng insane.

[PJ]

70% of the population requires protection from themselves. The blame rests with the institutions who prey on these 70%. If I took the money the bank wanted to give us when we first moved to Oakville I would be living on Lakeshore Drive, fackng insane.

I don't think the blame rests with the institutions.  It rests with the people that are too stupid to do basic math.  When you borrow money you have to pay it back.  Pretty easy to figure out when you're in too far.

[tpl]

Even if they try to control auto loans people could just put 100% of the cost on a home secured line of credit and pay it over decades. 

mmret has a better idea, make education in finances a standard course in schools.

When auto loans were regulated in the UK years ago there were MANY kitchen renovations driving around.

[safristi]

Like this Spanish "SEAT"

[Northernridge]

You lost me at "Government regulated". So, no. Just no.

Yeah! Except for clean water, clean air, safe food, safe medicine, safe cars and highways, what has the government ever done for us?

Let the market solve air pollution!

I believe citizens are capable of making their own decisions on consumer loans with minimal paternal oversight.

I do support government regulation for many broad public safety issues including some that you've identified. I also believe that all governments, regardless of political stripe, tend towards over regulation. "Give an inch and they'll take a mile" applies to policy makers and therefore debate on their process is always required, that's my focus.

[Sir Osis of Liver]

You lost me at "Government regulated". So, no. Just no.

Yeah! Except for clean water, clean air, safe food, safe medicine, safe cars and highways, what has the government ever done for us?

Let the market solve air pollution!

I believe citizens are capable of making their own decisions on consumer loans with minimal paternal oversight.

I do support government regulation for many broad public safety issues including some that you've identified. I also believe that all governments, regardless of political stripe, tend towards over regulation. "Give an inch and they'll take a mile" applies to policy makers and therefore debate on their process is always required, that's my focus.

All you have to do is look at the 2008 collapse to see what happens when the government steps away from regulating and enforcing those regulations. The unregulated derivatives market is still a mess and could very well collapse again. Financial institutions are literally banking on the fact that they are "too big to fail."

I believe that professionals in any industry can take advantage of an average citizen, not because the citizen is dumb, but these companies spend a lot of time and money researching ways to "maximise profit" regardless of the morality of the situation. Car loans, phone plans, cable bills, they screw people with the fine print all the time. Governments are the only means of setting limits on corporate behaviour.

[tooscoops]

people will always find a way around the regulations... i don't want to see this in place... i want to see debtors prisons and work houses and such back in place! (just in time for "a christmas carol"!)

as for rolling in other loans, all they would have to do is say the loan can only be for 90% of the vehicle price or something similar.

[mmret]

You lost me at "Government regulated". So, no. Just no.

Yeah! Except for clean water, clean air, safe food, safe medicine, safe cars and highways, what has the government ever done for us?

Let the market solve air pollution!

I believe citizens are capable of making their own decisions on consumer loans with minimal paternal oversight.

I do support government regulation for many broad public safety issues including some that you've identified. I also believe that all governments, regardless of political stripe, tend towards over regulation. "Give an inch and they'll take a mile" applies to policy makers and therefore debate on their process is always required, that's my focus.

All you have to do is look at the 2008 collapse to see what happens when the government steps away from regulating and enforcing those regulations. The unregulated derivatives market is still a mess and could very well collapse again. Financial institutions are literally banking on the fact that they are "too big to fail."

I believe that professionals in any industry can take advantage of an average citizen, not because the citizen is dumb, but these companies spend a lot of time and money researching ways to "maximise profit" regardless of the morality of the situation. Car loans, phone plans, cable bills, they screw people with the fine print all the time. Governments are the only means of setting limits on corporate behaviour.

Ah, we've been over this, but "homeownership for every American" was a de facto government sponsored plan.

That, and at the end of the day crashes happen. Always have, always will. Its built into human behaviour. The fact that it happened at the time that it did just makes securitization a convenient scapegoat, but that would be missing the point.

There were not really any derivatives to speak of in 1929. Still blew up!

EDIT:
We've also been over this, but the private sector did its share to push things forward, keep the charade going too. Many stupid and unethical things happened. But at least at the depths a lot of that got wiped out (between losses in stock markets and mass firings on the street). The fact that we're back at all time highs in the SPX is another story.

My only point is that the banks / private sector is not the wholly responsible party, as some (most?) seem to believe.

[wing]

As I'm reading this I get a call from the back asking if I want a loan for RRSPs.  Always praying on the masses to make more $

Sent from my Nexus 5 using Tapatalk

[tenpenny]

You lost me at "Government regulated". So, no. Just no.

Yeah! Except for clean water, clean air, safe food, safe medicine, safe cars and highways, what has the government ever done for us?

Let the market solve air pollution!

I believe citizens are capable of making their own decisions on consumer loans with minimal paternal oversight.

 Baseda on the number of people maxing out credit cards, I humbly suggest that is not true for 70% of people.

Sent from my Vic20 using Java Moose

[mmret]

As I'm reading this I get a call from the back asking if I want a loan for RRSPs.  Always praying on the masses to make more $

Sent from my Nexus 5 using Tapatalk

So giving offering you a loan, entirely at your discretion, is preying on you?