CENTRAL OHIO -- Homeowners are not the only people taking a beating in today's tough economy.
The American Banking Association reported more auto loan delinquencies in 2007 than in any year since 1992.
And the numbers appear to be worsening in 2008, NBC 4's Cabot Rea reported.
Tom Callaway, who manages Automobile Recovery Services in Obetz, Ohio, said his business is booming -- up 40 percent from one year ago.
"We have had several debtors tell us, 'We had to choose between our house and our car, and our car lost'," Callaway said.
A lot more people have either voluntarily or involuntarily made that choice in the last year, Callaway said.
Paula San Gabriel recently purchased an SUV that she thought was within her budget, until her engine blew and it took $6,000 to replace it.
"I took into account my current pay salary and then I took into account my bills such as insurance and gas," San Gabriel said.
In a bind, she missed a payment, and immediately her lender started calling.
"If people are in trouble, if they call us, we can try and work something out," Callaway said. "But if you start getting 60 to 90 days behind, they're not able to work with you. It's at that point that they want their collateral -- their property -- back."
One recommendation for car shoppers: beware of long-term financing, Rae reported. Some loans run up to seven years, and if you have to get out in three of four, you could owe more than the car is worth. If you cannot afford a four- or five-year payment plan, you may need to look for a less expensive car.
Stay tuned to NBC 4 and refresh nbc4i.com for the latest news and information.
To send a news tip or submit a story idea, e-mail stories@nbc4i.com.
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Economic Woes? The Car Then Goes
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Published: December 02, 2008
Published: December 02, 2008
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