In this episode, we cover why you shouldn t buy a car until you watch this video. The general consensus is if you want to get a car, you should lease it from a financial institution. But if you can pay it off in full, even better!
00:08:00.000you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you
00:12:27.000you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you you
00:12:57.000you you you you you you you you you you you you you you you you you you you you you you you you you you you Thank you.
00:15:14.000But of course, most people are in dire need of help because either they don't know how to buy a car, where to buy a car, or if to buy right now.
00:24:57.000You're going to lose money no matter what.
00:24:59.000But exiting the car, you can see from this price here of this Corvette, which is around 80K, which is what it was going for back then, brand new.
00:25:08.000Look over here, you got this price for 61K.
00:25:13.000So you can kind of estimate what you're going to lose on a car over a period of time.
00:25:17.000So look back like two years from before, but sometimes it's hard to guess because it can drop really, really hard versus like a small amount.
00:25:24.000But either way, the point is, you're going to lose money on these cars.
00:25:27.000This is a basic understanding of what's happening with the car market.
00:25:30.000But just so you understand, guys, you buy a car, hopefully you don't buy brand new because that's really dumb.
00:25:35.000Online, like allocation for the car, that's like a limited spec, like a Perfamonte or something like that, which is Lamborghini, then that's kind of fine.
00:25:42.000But allocating certain cars like this, bro, they're going to drop a value for sure.
00:25:46.000But at the same time, you can see how much money you lose, which is like around 30K for this car.
00:25:54.000Some people obviously lose their jobs.
00:25:57.000Things happen, and you can't always, You know, adjust for things happening.
00:26:03.000So, what happens is repos are at an all-time high nowadays, guys.
00:26:07.000And it's crazy because the numbers are increasing daily.
00:26:10.000So, look at these numbers here from the actual website, which is payments.com.
00:26:15.000It says here: car repos hit levels unseen since 2008 finance crisis.
00:26:20.000This is why I say, guys, buying cars right now is not really smart because what's going to happen now is that like all the rates are really high.
00:26:27.000And let's say you want to get out of this car, exit is going to be trash.
00:26:30.000So, you got high interest rates, massive payments, and then getting out of the car is the worst part.
00:26:35.000Because remember, you still got to pay for the car every month.
00:26:38.000And then to exit the car, whatever the negative equity is in that car, you got to pay off.
00:26:42.000So, let's say this car, so for example, let's say this Corvette, right?
00:33:27.000for a row levels in general in the past 15 years since the 08 financial crisis, which I don't have to tell you is definitely not a good, by the, I've never had one repossession, never one late payment, never one issue with my bank or my lenders.
00:33:45.000I've paid everything off because to me, a word is my bond.
00:33:49.000And if I put myself on a line for a car, I'm getting rid of that shit and I'm paying off in full.
00:33:53.000If not, then my credit score would be terrible.
00:35:28.000I mean, listen, if you're a responsible investor, a financial, what's there for your finances and you're good with your credit score, your shit's paid off, then you buying a car is not the worst thing if you're obviously smart with your money.
00:35:41.000However, you need to buy it the right way and I'll get finessed because, guys, car dealerships, man, this is a little secret here.
00:35:48.000They make money off of doing loans, right?
00:35:51.000The cars itself, maybe a couple grand, maybe a little bit there, but the bang of their buck is made from you getting a loan with them, either a lease or finance.
00:35:59.000That's how they make their money, bro.
00:36:23.000As your eyes can see, all of these are a manifestation of bad financial decisions, over-leveraging credit and budget.
00:36:30.000And unfortunately, it ends up in a lot like this, where it's going to be sold at auction, cycled back into the car market at a fraction of the cost.
00:36:36.000So you know what people are very smart?
00:36:39.000They go to auctions and they buy the cars that are repossessed on like pretty much like pennies on the dollar.
00:36:46.000Because they get into the car after depreciation and after it's been sold to the bank, which means the bank has said, fuck this shit, get these cars out of my way.
00:36:57.000And that's where you, as a smart investor, can say, okay, if I get my auction license, I can go buy a car for pennies on the dollar, basically.
00:37:06.000And I get the same car people had, but hey, I get a year or two later.
00:37:10.000It looks the exact same, but I get it for half the money price of the car or even less.
00:37:15.000So I think it's not a bad idea to go to auctions because, or know somebody that's there, because if you can get this plug here, guys, you can get cars for a way cheaper price.
00:37:29.000Suburbans, Audis, Toyotas, Ram 3500s, Jeeps, another bunch of luxury cars.
00:37:40.0002024 Kia Telluride with only 16,000 miles repoed.
00:37:46.000Dealer charged $3,000 for a thorough inspection and reconditioning fee and $1,000 for interior protection, which is an additional $4,000 on an already inflated MSRP of $47,380.
00:38:14.000He just said they basically added on $4K to the car for random shit.
00:38:20.000Yo, guys, yo, yo, this is like higher robbery at the highest level, but because they have a monopoly or they're probably the only ones in that city or that state doing car deals like this, or you can't get approved, they can work the numbers.
00:38:34.000And then before you know it, they got you, bro.
00:38:36.000So guys, be careful, man, buying cars because if you're not careful, it can mess you up really bad.
00:41:36.000And the reality is, guys, like, when this happens to you, it's shameful, bro.
00:41:41.000Yo, I know some YouTubers, bro, that think they're slick, but I've seen, because I know dealerships and I'm cool with some people, and I see some of their, like, auto history, like, inspections and all this stuff.
00:42:36.000If you can get a credit union to give you a loan before you can go to the dealership, even better.
00:42:40.000You go either look at the car, you give them the VIN number, you give them the price of the car, and they can give you a loan approval right there on the spot, credit union, before you go into the dealership.
00:42:48.000So you can say, hey, dealership, I got my own loan.
00:45:15.000Well, we are going to see a little bit later people having some really rough credit scores with repossessions in their history, and they still end up going to a dealership.
00:45:22.000But we have a comment from one of you guys.
00:46:09.000Now, during this time of year, then we usually see, even with the record rates of repossessions, the record rates of auto loan delinquencies that are experiencing right now, they have even jumped over the last little time period.
00:46:20.000And I'll tell you why, because we are actually in the peak right now.
00:46:24.000Let me just mod people real quick on kick.
00:50:04.000If you can that'd be dope Yeah, I gotta say don't log in to see it though.
00:50:09.000Alright bet bro yeah continue on keep doing what you're going.
00:50:11.000Thanks man cool all right Shea you should be in there as a mod brother appreciate it bro Donna Marco for Shea man When I was on Twitch going crazy in the streets in San Fran and Miami he was supporting as well yo yo yo Twitch we were live We were getting lit on Twitch, bro Like we were getting lit on Twitch about to pop off man and we got banned bro, but whatever it's all good bro But sub goal guys is 500 man.
00:51:34.000And I'm more like, bro, just look at it from the standpoint of, do you want to stress, bro?
00:51:41.000i have a i've already hit the pinnacle i've already did everything you could you could you could think about it luxury regular cars i've had and it's like i'm gonna point out where i'm like yo does this actually give me peace of mind and financial freedom if not i don't want it bro like you're better off renting than getting into a deal with a lease or finance for a car that you can't maintain or don't want to maintain remember you need most loans are between four to six years minimum, right?
00:52:12.000Which means like you got to pay that car for that amount of time.
00:52:14.000And if you don't, you got to pay heavy interest the entire time and then pay it off with negative equity for the most part.
00:52:22.000So just think about that before you go buy a car, man.
00:52:24.000Because is it really worth your freedom?
00:52:27.000Remember, you become a slave to the car.
00:52:30.000I was a slave to a lot of my cars where like I'll travel to like Europe and be with Andrew and them and Tate and their boys and I'm thinking about my car payments.
00:52:40.000Like, you should be free thinking, just having fun, enjoying the moments versus thinking about your car payment or your actual like bills at home, you know?
00:53:03.000A lot of cars come and get repossessed right at the beginning of summer because people just stopped making payments on their new car that they thought they can actually afford when they could not.
00:53:13.000So we also touched on this a little bit when I talked about the tax refund season.
00:53:18.000People taking all the money that is rightfully theirs, the government just held on to it and ended up giving it back, but they would blow it on a down payment on a luxury car or go to Disney, vacations.
00:53:28.000And then they're right back to square one, paycheck to paycheck, barely speaking.
00:53:31.000Fellas, especially here in Miami, I've seen guys come to the scene and they legit have like a start in the marketplace.
00:53:40.000They start making some money and they go buy the biggest car they can get, biggest setup they can get.
00:53:46.000And then things go wrong and life is like up and down.
00:53:50.000One minute you're up, one minute you're down.
00:53:52.000It's never really like a flat line stable where everything is going good.
00:53:55.000So when you have payments you got to maintain, it could really mess you up because you could be up one day, down the next day, and then you got to still make payments the entire time as a baseline.
00:54:07.000So you're kind of like, you know, hoping and praying that nothing goes wrong, but things do go wrong.
00:54:22.000And I guess this is almost a yearly event.
00:54:25.000Right around the summertime, you start seeing a lot more of those repos of the people who couldn't actually afford that Mercedes-Benz or luxury SUV, whatever they got.
00:54:32.000And I mean, here's another clip right here, watching the car I bought with taxes get repoed because I couldn't afford it anymore.
00:54:38.000If you could barely afford the down payment in the first place and the only reason you were able to was because you got your yearly tax refund, when you signed the contract showing the monthly payments, you had to know that you weren't going to afford it in the end.
00:54:51.000Dealership's fun, but sometimes it's not.
00:54:53.000We just had a repo this car from a customer.
00:59:15.000I will basically accept anybody for a loan, but because credit acceptance is terrible, trying to impress my neighbor, I mean all of that kind of stuff.
00:59:22.000And we have another comment from you guys.
00:59:23.000Vehicles are the kryptonite of financial freedom.
00:59:26.000Don't be caught in the web of auto hamster wheels.
00:59:55.000I could have bought more property, more Bitcoin, which I'm buying a lot right now as we speak.
01:00:01.000You know, I could have done a lot more stuff.
01:00:03.000But again, having car payments, fellas, don't do it, man.
01:00:09.000If you can avoid it and just build your cash up, build yourself up, have a stable savings, do that instead because, bruh, having car payments is a L. Like, moving forward, I just got the new G-Wagon, of course.
01:01:08.000Only buy what you could pay for cash unless you have outrageous income, which most people do not have.
01:01:13.000But the previous clip really said it perfectly.
01:01:15.000Trying to flex for Instagram, the neighbors, your friends and family, because you see other random influencers or celebrities showing off their range rovers and G-Wagons in front of their big mansions.
01:01:25.000Which, if we're talking about influencers, a good amount of time, that's just completely fake.
01:01:30.000But it seems like everybody wants to keep up with the Joneses, make it look like they have more wealth than they do.
01:01:34.000And unfortunately, that turns into getting repossessed.
01:01:38.000I mean, honestly, guys, what you just said right there is important because looking at it from that point of view, people that have money are really not that flashy.
01:01:48.000They're more low-key, more down-to-earth, more like hidden in shadows.
01:02:45.000And we still are, but, you know, just a little bit more quiet now.
01:02:49.000And I just feel like at some point, you know, you got to understand that, like, there's a game being played here.
01:02:56.000And the top elites, the people that are top, are playing it very smart.
01:02:59.000And I think it was Machiavelli that said, you don't want to show too much of your hand because then people can use it against you or plan to attack you.
01:05:00.000So yeah, if you want to look this up yourself, there are entire compilations, YouTube channels just showing the outrageous stuff that happens during these repos.
01:05:07.000But of course, this is the internet and social media, and there's a whole bunch of people that just don't take it seriously at all.
01:06:48.000But buying a car before that, before I bought a property, bro, I would have been cooked because now you can't even save towards your future, bro.
01:06:54.000All the money's going towards your car.
01:06:56.000And listen, back in the day, I was a JDM Square guy.
01:09:01.000So I'm telling y'all, man, I'm telling y'all, cars could be your rehearse, literally.
01:09:10.000Getting $745 a month and with interest rates near their all-time highs, Americans are now officially beginning to fall behind in their payments.
01:09:18.000This is why it's so important that we break down exactly why cars have become America's number one wealth killer, why used car prices are spiking again, and then what the data says is most likely going to happen over the next year.
01:09:30.000Because there are three points that you need to be made aware of if you want to save a ton of money.
01:09:35.000Although before we start, if you appreciate videos like this or even find them helpful, it would mean the world to me if you gave the like button a little Guys, yeah, you know what?
01:09:43.000If you don't mind, like my videos as well, man,'cause Grandma's right, you should be liking videos.
01:09:47.000So we won't cover all this video today, just a small part of it.
01:10:11.000For the longest time, when you think about car prices, you'd imagine a chart like this.
01:10:16.000In a normal market, a new car is expected to lose anywhere from 9% to 18% the moment you drive it off the lot.
01:10:22.000And then from there, prices continue to fall by an additional 10 to 20% a year until after five years of ownership, you're left with about 40% of the price that you paid.
01:10:31.000However, these last few years have completely messed that up.
01:10:35.000Because of a shortage of auto manufacturing, a limited supply of parts, record low interest rates, and the surge of demand, used car prices began to defy the laws of gravity by going up in price.
01:10:46.000For instance, in 2021, used car prices were 40% higher than the year prior.
01:10:51.000Meaning back then, you could literally go and buy a car, drive it around for free, and then So Cam, that's a very good question.
01:10:57.000When do you think is the best time for the car market?
01:11:00.000So usually, right, what happens is dealerships are always fighting for the best price, of course, because that's how they made their money.
01:11:11.000So now they don't want to concede in lower prices because the lower prices, then obviously you get a better deal, one, but two, they lose margins for sure.
01:11:21.000So they're still upholding a high price for cars, which is why you can still see Corvettes going for, you know what, you know what's a good example?
01:11:29.000There was a car that everyone wanted back in the day.
01:14:06.000So, the point with this is that, like, you buy the wrong car, fellas, you're going to spend a year's paycheck or more getting out of that car if you can.
01:14:16.000You know, the worst case scenario, fellas, is when you get a car, you can't get out of it.
01:15:06.000They were charging people over sticker price because they wanted a car, because the demand was there.
01:15:12.000So the CA Corvettes were so much demand, they made bank off people 10, 20k over.
01:15:18.000The average vehicle was priced 9.9% above MSRP, all thanks to high demand and limited supply.
01:15:25.000Yet, despite nearly every other pandemic shortage eventually coming back down to reality, car prices never really fell that much.
01:15:33.000Like as of now, new cars are still $12,000 more expensive than they were a few years ago.
01:15:39.000The typical family would have to spend 70 to 80% of their entire year's pay just to buy a vehicle at today's prices, which is double from what it used to be in 1990.
01:15:48.000And all of this simply means that car prices are outpacing incomes.
01:15:52.000More buyers than ever have payments that exceed $1,000 a month.
01:15:56.000And we have a new category that's absolutely out of control.
01:15:59.000Interest rates that were more than double the average since they were just desperate.
01:16:03.000So what he's saying, guys, is that like now, even though prices are not budging, the rates are really high.
01:19:07.000But again, like, this is where, like, you gotta use common sense and use what's happening in the world of leverage here because you can see the market is not where it should be for cars and real estate.