Next Financial Crash: Buy Here Pay Here Used-Car Dealers

Next Financial Crash: Buy Here Pay Here Used-Car Dealers

According to a report in the LA Times “Private equity firms are investing in chains of used-car lots, and auto loans are being packaged into securities much like subprime mortgages. They’re attracted by the industry’s average profit of 38% for each car sold…”. Guest hosts Richard Eskow and Brian Unger discuss on The Young Turks. Learn more here:

http://www.latimes.com/business/buy-here-pay-here/la-fi-buy-here-pay-here-part1-storyb,0,5689256.story

http://www.latimes.com/business/buy-here-pay-here/la-fi-buyhere-payhere-day-two-20111101,0,3779131.story

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20 Responses

  1. Kerry says:

    Black people (often) don't pay their bills, these people are willing to take the risk and deserve to get payed for it. #RealityOfNotPayingYourBills

  2. AZDuffman says:

    Yeah, it has to be racism and not risk management. Just looking at the subtitles we can see how poorly done this video is.

  3. Hello By says:

    Getting you to come back it's called repossession when you don't pay you don't get to play.

  4. 湯 茂 林 Maurice says:

    This is the stupidest shit I've heard in a long time. Car dealers aren't inherently racist… they just want MONEY. The Young Turks are deplorable for spreading this nonsense.

  5. bigfatmouth says:

    The mortgage crash was partly (mostly?) due to risky mortgages being buried inside complex financial instruments. In other words, these mortgages were moved into the more "public" trading environment (affecting many people), rather than simply being an owed debt on the issuing bank's balance sheet. It was that movement and subsequent fiddling (that average investors also bought into) that caused the crash.

    If the BHPH lots are constantly reselling repossessed cars, those loans aren't being moved into any other part of the financial arena. They're on that company's books. Granted, the practice still sucks and people with bad credit can get caught in a cycle, but to claim this could cause a larger "crash" is a stretch. Joe investor's money isn't being invested in any financial instruments containing BHPH loans.

  6. Rodney bigboy says:

    the young jerk's it's hoodrat credit

  7. ralph lorenzo says:

    this is bullshit! I manage a car lot and I have never heard of this before. We work with applicants. We charge 80.00 Dollars per week and work with customers when they have problems.

    Whe do balloon payments where the customer can drive off a car with less money, and defer payments if they cant pay for valid reasons like loss of job, death in the family or illness.

    Most of my customers are black and are treated like everyone else. these guys are full of shit!,

  8. Joey Garcia says:

    WTF 400 to 500 car payments on a used car that has over100 thousand miles on a used car all I can say is OMG are people that stupid seriously. You can buy a brand new car with no miles on it for that much

  9. guns dont kill people i do Tony says:

    if the price is not on the windshield there to high i've bought plenty of cars

  10. viyau says:

    This is so far the best explained I have seen in youtube so far in regards to the subject matter. Unfortunately the low credit rating ecompasses not only loans for a car, a house, but also if you are late paying a water bill I know Citibank and Chase will increase their interest rate on YOUR credit car because you were late with a water bill. The people who could benefit for a 0 percent car loan are the very ones with bad credit because everything is more expensive for them, they are not able to get adequate housing because of credit, they get declined living places, they are required more of a deposit for an apartment, all of these things that are $$$ and people dont have the money. This system is set up for failure.

  11. Cameron Looper says:

    Yes, this is very true. I personally, went to a buy here pay here dealer, and offered them cash instead of finance. I was looking at a Ford Explorer and they had a price online for around $10k. little did I know, that was the buy here pay here plan price. when I offered them the 10k in cash, they told me they had the price wrong and it was now $14,000. sounds a little fishy to me. After that, I went to another buy here pay here, and offered them $10k cash once again and they wouldn't even let me purchase a vehicle!

  12. derek jones says:

    Whaaaaaaaaaaaaaaa!

  13. jerzeyboi6091 says:

    These guys are complete morons. Let's how quickly these guys want to give out a loan on a 20 thousand dollar car to someone with a 500 credit score, bankruptcies, divorce. And it's funded by hedge fund managers. Come on pal. Biggest bunch of horse shit I've heard. Bullshit and bad reporting and as long as there's people with bad credit there is going to be high interest loans. It's common sense. So I see buy here pay here going when high interest credit cards and loans go away. When pigs can fly

  14. Loukas Michael says:

    They are not describing bhph dealers, who fund their own loans, they are describing dealers that do point of sale financing that get the loans from financial institutions that get their money from Wall Street. These clowns have no clue what bhph is all about in fact it's ass clowns like those 2 idiots that are the ones ripping people off on Wall Street

  15. gmeadville says:

    THE BEST WAY NOT TO BE (TAKEN ADVANTAGE OF) OR BE HELPED BY THESE DEALERS. AND THIS MAY SOUND A LITTLE FAR FETCHED. IS IS IS. I KNOW YOUR SITTIN ON THE EDGE OF YOUR CHAIR IN SUSPENSE. IS WHEN A BILL COMES IN THE MAIL OR YOU BUY SOMETHING (BLACK WHITE OR ASIAN) HERE WE GO   THE SECRET IS…  YOU PAY FOR IT!!!  IT ALMOST SOUNDS TO SIMPLE DOESN'T IT? BECAUSE CREDITORS DON'T REPORT NEGATIVE ON THE BUREAU IF YOU PAY YOUR PAYMENTS ON TIME. THIS INCLUDES AND NOT LIMITED TO. CAR PAYMENTS, APT LEASES, CELL PHONES, CREDIT CARDS, SCHOOL LOANS, MEDICAL BILLS, ETC ETC.

  16. pure survival says:

    These two idiots dont have a fucking clue on how buy here pay here actually works… tons and tons of misinformation in this video.

  17. EZAUTOCREDITUSA says:

    People need to be careful who they deal with. It is a shame people are not educated more about financial transactions in high school.

  18. stuart Skrabec says:

    Used car sales is exploited slavery?

  19. Gary Wegrzyn says:

    if you can do over 300 dollars a month thats not poor

  20. MOUNTAIN GAP Boutique says:

    All they are calling consumers with poor credit are garbage. What they are saying is if your credit is less than perfect and you have to get financing from a buy here pay here dealership that ultimately you will repo. They have not once talked about how us buy here pay here dealerships will finance bad credit and take all the risk in hopes you will pay for that car.. They are so snooty and "perfect" they don't have to worry about buy here pay here lots. I sell vehicles everyday using my buy here pay here system and I have a very low repo rate and I also report to credit monthly. So, not only are you getting the reliable transportation you need and deserve, you are also building your credit month after month. Yes, we do have a high interest rate, but look at it from our point of view. Your credit score tells me a lot about your pay history and your financial stability. So, when I look at your credit and see how poor it may be, but I still sell you a car, of course the interest will be high because of the risk I am willing to take to get you in a dependable vehicle. These upper class gentlemen have no Idea what its like to fall on hard times and need a vehicle with less than perfect credit.. They're parents more than likely gave them their first cars and went on from there to help them financially until they were stable. A lot of people, including myself, didn't have that growing up so therefore had to work for everything and didn't get to easily build their credit. All I'm trying to say is please don't judge us buy here pay here dealerships until you fully understand what we are about.

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