[Unknown_Car]

Originally Posted by DarkstarZero

I'm wondering if there will be a complete collapse of the used car market over the next 6 months.

A loan officer told me that I would be blown away by how many people out there have cars they shouldn't be able to afford but do because they got a 10 year loan at like 12% interest in order to have low monthly payments that they could make. These are luxury cars like BMWs, Mercs, Porches, and Teslas.

Edit
Some people find this hard to believe. A great example is BMW's own "BMW Select Financing" program which is balloon financing offering "Lower monthly payments up front and the option to refinance if you're qualified." Essentially turning a 5 year auto loan into a 10 year loan with refinancing (or repossession) at the end of the first leg.
/Edit

Now that means all these people are way upside down on their loans. The first things to go when people try to maintain financial stability are their cars. But since they're going to be so upside down, the easiest way out is to default on the loan. I think everyone is going to do this around the same time - which means a flood of cars going to auction at the same time and then hitting the market at the same time. About 3 months from now is my guess.

I drove by carmax the other day and their lot is already PACKED, fence to fence, bumper to bumper, no room for more cars and no buyers.

But at the same time, auto makers have shut down - so with no new cars coming into the market, will it all just even out?

CarMax was always packet around here, so nothing new.