141 – How Car Loans Can Lead to Insolvency

Debt Free in 30

There are two major purchases we make in our life that we typically use debt to purchase. The first (no surprise here) is our home, and the second is our car. But can car loans lead to insolvency? Believe it or not, yes car loans can lead to insolvency.

As cars are getting more sophisticated and fitted with new gadgets and features, which means they're also getting more expensive. You're no longer buying just a car, you're buying a driving computer. Instead of the days where we could just pay cash up front for our vehicle, we're presented with loans and leases as a way to stretch the total amount over a number of years. In some cases, car loans extend up to eight years.

This makes cars more affordable for the every day consumer, which is great for car companies as they're able to continue with the technological evolution of their cars.

But, they can get expensive, so on today’s show Doug Hoyes explains why we get into debt with cars, and he gives practical advice for dealing with car loan debt.