What does less driving mean for society?
Lexus Fanatic
Joined: Oct 2003
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From: Virginia/D.C. suburbs
No, it's an opinion. Glad it works for you and LexCTJill. But not 'correct' for everyone.
Seems that LexCTJill, despite being very proud of owning several vehicles outright, has had a bunch of significant repairs to pay for. Certainly not unusual with older vehicles, but nevertheless, by owning or leasing a much newer vehicle the chances of those kind of repairs (or worse, being stranded until the tow truck arrives) are much lower.
Seems that LexCTJill, despite being very proud of owning several vehicles outright, has had a bunch of significant repairs to pay for. Certainly not unusual with older vehicles, but nevertheless, by owning or leasing a much newer vehicle the chances of those kind of repairs (or worse, being stranded until the tow truck arrives) are much lower.
This may not work for everyone, but, a (typically) reasonable compromise between the steep depreciation of the first few years of a vehicle's life and the increasing probability of expensive repairs in the long run is to replace one's vehicle every 4-6 years. That way, you get a reasonable amount of use for it for you investment, but it has usually not yet reached the point where it can become a money pit.
When challenged on this by SW17LS you agreed with the challenge, contradicting the above 'absolute'.
Big is relative, not absolute. Someone making 7 or 8 figures a year isn't concerned with a car payment in the least.
So don't keep telling everyone that they should only do what you deem 'common sense'.
Last edited by mmarshall; May 28, 2020 at 07:41 AM.
Lexus Fanatic
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From: Maryland
The point is for the vast majority of people, payment default and repossession are a non issue. If I were to ever be in a situation where I would be forced to default on my vehicle payment as a responsible person I would have remedied that situation long before I got to that point. The vast majority of people are like me, car loan defaults are in the extreme minority, and of those car loan defaults the % that wind up being repossessed are the extreme minority.
If someone is in such dire straits that they can't make their car payments, why is it a stretch to assume they can pay their taxes? You would only not pay your car loan if you suffered a major financial disaster. Same with your taxes. Not paying your taxes is not criminal tax evasion. If you don't pay taxes or work out an arrangement eventually the IRS will seize your property to pay the debt, like any other creditor they just have the power to do it far more quickly. If you are sued and get a judgement filed against you for any reason they can force the sale of your assets to pay the judgement. These things sound unlikely, because they are...but so is car loan default.
How does chosing to pay cash vs a loan or lease have anything to do with that? The money is spent either way, and perhaps at a greater cost. Issue is you keep equating using loans and leasing as a negative sign that the purchaser can't afford the car. The total of my car payments is less than 5% of my monthly income. Thats both cars.
In an effort to create a community I think we each have the responsibility to try and make sure that our opinions are our opinions and not value judgements. When you say something "is correct" that means something else is "incorrect", which isn't the case.
The vast majority of people buy cars with some sort of financing, and they never default, and they are able to live their lives and stay out of poverty and die happy, fed and fulfilled.
No. What said was that if one is involved in a crime (such as tax-evasion), then we both agree that the normal rules of what can be reposessed go out the window. There is a BIG difference between the bank repossessing something for simple payment-default (which is a civil matter, not necessarily a crime), and the state impounding something for criminal reasons.
That attitude, however, can get one into trouble. With some people, the more they make, the more they waste.
In an effort to create a community I think we each have the responsibility to try and make sure that our opinions are our opinions and not value judgements. When you say something "is correct" that means something else is "incorrect", which isn't the case.
The vast majority of people buy cars with some sort of financing, and they never default, and they are able to live their lives and stay out of poverty and die happy, fed and fulfilled.
Last edited by SW17LS; May 28, 2020 at 07:50 AM.
Lexus Fanatic
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From: Maryland
Out of curiosity I looked it up. The 30 day delinquency rate on indirect car loans is 2.43%...and thats an 8 year high. So 97.57% of car loans are current. And of that 2.43% that are 30 days delinquent, a very small % will ever get to the point where they would be repossessed.
So you see why lenders are so willing to lend freely on cars.
Whats the delinquency rate on federal income taxes? 8.7%!. So again, my scenario where someone owns a car outright and has it seized by the IRS is actually less far fetched than someone having their car repossessed because they couldn't make the payments.
Not using car loans because you're afraid your car will be repossessed is like not using a knife because you're afraid you'll stab yourself in the chest.Well, just don't stab yourself in the chest. Just make the payments and you'll never have to worry about reposession.
So you see why lenders are so willing to lend freely on cars.
Whats the delinquency rate on federal income taxes? 8.7%!. So again, my scenario where someone owns a car outright and has it seized by the IRS is actually less far fetched than someone having their car repossessed because they couldn't make the payments.
Not using car loans because you're afraid your car will be repossessed is like not using a knife because you're afraid you'll stab yourself in the chest.Well, just don't stab yourself in the chest. Just make the payments and you'll never have to worry about reposession.
Pole Position
Joined: Jan 2020
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From: CA
What does less driving mean for society? Perhaps less growth in the whole auto sector, manufacturing, sales, maintenance, auto-financing. This downturn will likely carry over to many related parts of the economy, in addition to the already staggering consequences the pandemic is having on the non-related sectors.
Since this thread drifted to the lease vs finance vs buy outright debate, it will be interesting to see if and how the pandemic affects this very personal decision. I'm no economics wiz, but, in spite of what we are currently seeing on wall street, I predict a crash. Even if there isn't one, the Fed's printing trillions of dollars of cash to bail out select sectors will have a long-term negative affect on all dollar-holders due to inflation (as inflation devalues the dollar). During high inflationary times, wouldn't it be beneficial to owe a lot of money rather than have a lot of money in assets and savings? That is, one borrows at the current dollar value, but pays back the money over time at the future de-valued level. I'm not claiming to know anything, or of being able to predict the future, but, if we experience high inflation, wouldn't a long-term loan on a vehicle be preferential to leasing or buying outright? My premise assumes people's wages will inflate along with everything else, but I wouldn't count on that either. It also assumes the tax code won't change to favor one strategy over another.
Bottom line, it's a crap shoot! We can only guess and gamble on how the pandemic will affect us, our driving lifestyles, and our personal economic strategies. I appreciate the opinions and perspectives of the contributors to this forum, so, thanks for sharing!
Since this thread drifted to the lease vs finance vs buy outright debate, it will be interesting to see if and how the pandemic affects this very personal decision. I'm no economics wiz, but, in spite of what we are currently seeing on wall street, I predict a crash. Even if there isn't one, the Fed's printing trillions of dollars of cash to bail out select sectors will have a long-term negative affect on all dollar-holders due to inflation (as inflation devalues the dollar). During high inflationary times, wouldn't it be beneficial to owe a lot of money rather than have a lot of money in assets and savings? That is, one borrows at the current dollar value, but pays back the money over time at the future de-valued level. I'm not claiming to know anything, or of being able to predict the future, but, if we experience high inflation, wouldn't a long-term loan on a vehicle be preferential to leasing or buying outright? My premise assumes people's wages will inflate along with everything else, but I wouldn't count on that either. It also assumes the tax code won't change to favor one strategy over another.
Bottom line, it's a crap shoot! We can only guess and gamble on how the pandemic will affect us, our driving lifestyles, and our personal economic strategies. I appreciate the opinions and perspectives of the contributors to this forum, so, thanks for sharing!
Lexus Fanatic
Joined: Oct 2003
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From: Virginia/D.C. suburbs
For the most part, though, except for some local housing markets, inflation has not been a major problem for decades. It was probably at its worst (double-digits) in the late 70s and very early 80s, before the economy was finally tamed in the early-to-mid 1980s. In fact, lately, we have seen virtually record-low gas prices.
Lexus Test Driver
Joined: Jan 2007
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From: CA
This may not work for everyone, but, a (typically) reasonable compromise between the steep depreciation of the first few years of a vehicle's life and the increasing probability of expensive repairs in the long run is to replace one's vehicle every 4-6 years. That way, you get a reasonable amount of use for it for you investment, but it has usually not yet reached the point where it can become a money pit.
There is a BIG difference between the bank repossessing something for simple payment-default (which is a civil matter, not necessarily a crime), and the state impounding something for criminal reasons.
Lexus Fanatic
Joined: Nov 2011
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From: ON/NY
Looking back, the 2007-2012 ages far nicer than people give it credit (including my own criticism of it). How do you like the powertrain of the current/new 2020 ES compared to the 2010?
Lexus Fanatic
Joined: Oct 2003
Posts: 94,223
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From: Virginia/D.C. suburbs
if you buy a new car every 4-6 years, leasing is either cheaper, or a wash because most people are financing 4+ years anyway, and they're financing the WHOLE purchase, whereas leasing you're basically paying the depreciation only. it seems you can't wrap your head around that, but that's ok.
And, since you bring up the subject of leasing, it is possible to pay off the entire 2-4 year lease, up front...I have a friend who does that, every 27 months (the lease-term at the local Lexus dealership) on a new ES350. The dealership actually gives him a discount for that, since they get all the money up front, and don't have to wait for it.
the only person talking about criminal matters is you. if someone is in criminal trouble, whether or not they leased or bought their car is likely the least of their problems (not to mention legal bills).
Joined: Feb 2001
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From: North Carolina
If you can find some details of the subset where that might actually happen it would be at least somewhat accurate - but 8.7% isn't remotely close. In fact a little googling (this is dated but certainly still applies):
https://howardlevyirslawyer.com/2011...d-take-my-car/
Is the IRS going to seize and take my car?By Howard S. Levy, Esq., IRS Enforcement Statistics, IRS levies and property seizures, IRS Seizures, Revenue Officers
In other words, it is quite unlikely that the IRS wants your car. The same logic applies to your house.
The real concern is your wages, bank accounts – liquid assets.Here is a practical question from a reader about a concern of everyday living – IRS seizure of your car to pay your tax debt.
If I own a free and clear vehicle that is ten years old and has 115k miles on it, and it is worth 4,000. Will it be seized if the IRS does a levy and I have no other assets/income for them to take?
The IRS is rarely in the business of taking your car and preventing you from getting to work, the grocery store, or the doctor. To have the IRS interested in a seizure of a vehicle, in most cases, you will have to be in a extreme position of noncooperation. Good communication with a Revenue Officer lowers any risk of the IRS seizing your vehicle.
Speaking of Revenue Officers, unless one has contacted you and is assigned to investigate collection of your tax debt, the chances of car seizure becomes even more remote. This is because the IRS will need local enforcement to investigate the seizure of a car. If all is quiet, or your case in the IRS Automated Collection Service, it is impractical that your car will be seized.
Speaking of practicality, the IRS is most interested in property seizures when it results in some real recovery to them. A vehicle worth $4,000 most likely is not a prime source of recovery for the IRS, especially considering the hardship to you from loss of transportation. A Ferrari would be a different story.
This prohibition on seizures without recovery is in the Internal Revenue Code, specifically section 6331(f), which prevents uneconomical levies. You can also reference Internal Revenue Manual 5.10.1.2, which states that “Seizures where the taxpayer has insufficient equity in property – there must be sufficient net proceeds from the sale to provide funds to apply to the taxpayer’s unpaid tax liabilities.”
Also, keep in mind that Internal Revenue Code 6343(a) prevents an IRS levy if it creates an economic hardship. Seizing a car that will prevent you from going to work creates an economic hardship.
The numbers speak for themselves that the IRS is not usually in the car repo business. For the IRS fiscal year 2009, the IRS made 581 seizures made of real and personal property. With millions of taxpayers in debt to the IRS, seizures of hard assets are relatively rare. Of the seizures made, the vast majority were real estate, with a much smaller percentage out of the 581 being vehicles.
In other words, it is quite unlikely that the IRS wants your car. The same logic applies to your house.
The real concern is your wages, bank accounts – liquid assets.Here is a practical question from a reader about a concern of everyday living – IRS seizure of your car to pay your tax debt.
If I own a free and clear vehicle that is ten years old and has 115k miles on it, and it is worth 4,000. Will it be seized if the IRS does a levy and I have no other assets/income for them to take?
The IRS is rarely in the business of taking your car and preventing you from getting to work, the grocery store, or the doctor. To have the IRS interested in a seizure of a vehicle, in most cases, you will have to be in a extreme position of noncooperation. Good communication with a Revenue Officer lowers any risk of the IRS seizing your vehicle.
Speaking of Revenue Officers, unless one has contacted you and is assigned to investigate collection of your tax debt, the chances of car seizure becomes even more remote. This is because the IRS will need local enforcement to investigate the seizure of a car. If all is quiet, or your case in the IRS Automated Collection Service, it is impractical that your car will be seized.
Speaking of practicality, the IRS is most interested in property seizures when it results in some real recovery to them. A vehicle worth $4,000 most likely is not a prime source of recovery for the IRS, especially considering the hardship to you from loss of transportation. A Ferrari would be a different story.
This prohibition on seizures without recovery is in the Internal Revenue Code, specifically section 6331(f), which prevents uneconomical levies. You can also reference Internal Revenue Manual 5.10.1.2, which states that “Seizures where the taxpayer has insufficient equity in property – there must be sufficient net proceeds from the sale to provide funds to apply to the taxpayer’s unpaid tax liabilities.”
Also, keep in mind that Internal Revenue Code 6343(a) prevents an IRS levy if it creates an economic hardship. Seizing a car that will prevent you from going to work creates an economic hardship.
The numbers speak for themselves that the IRS is not usually in the car repo business. For the IRS fiscal year 2009, the IRS made 581 seizures made of real and personal property. With millions of taxpayers in debt to the IRS, seizures of hard assets are relatively rare. Of the seizures made, the vast majority were real estate, with a much smaller percentage out of the 581 being vehicles.
https://resolvion.com/22-repo-indust...ends-analysis/
compared to 1.9 million repossessed that same year according to the above
Last edited by DaveGS4; May 28, 2020 at 04:47 PM.
Lexus Test Driver
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From: CA
BTW, i've seen a ton of cars on the road these days as the country goes into Phase 2. I think the death of driving has been greatly exaggerated. In fact, I don't see anyone really eager to fly anymore so I think we may see an increase in good old fashioned road trips this summer.
Lexus Fanatic
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From: Maryland
Not that I agree or disagree with any specific point in this thread but this statistical comment stuck me as way out of whack. Certainly 8.7% of the population that are delinquent on taxes do not have their car seized as part of a settlement. I'd guess the majority of that estimate have no significant action taken on them at all beyond communications because that percentage would include minor delinquencies like late and partial payments, etc. that would be a large part of the #.
If you can find some details of the subset where that might actually happen it would be at least somewhat accurate - but 8.7% isn't remotely close. In fact a little googling (this is dated but certainly still applies):
If you can find some details of the subset where that might actually happen it would be at least somewhat accurate - but 8.7% isn't remotely close. In fact a little googling (this is dated but certainly still applies):
Lots of stuff the IRS would seize before they would seize a vehicle, the point was...it is possible to have a vehicle thats owned outright repossessed.
Joined: Feb 2001
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From: North Carolina
You could say ‘possible’ but It would be ‘less far fetched’ to compare that possibility to your chance of getting bit by a shark 
In 2009 the far less than < 581 seized actual compared to the actual 1.9m vehicles repossessed the same year is very much statistically insignificant.
enough of that topic no need to debate further - just had to bring in a bit of reality to something that was out of whack.
In 2009 the far less than < 581 seized actual compared to the actual 1.9m vehicles repossessed the same year is very much statistically insignificant.
enough of that topic no need to debate further - just had to bring in a bit of reality to something that was out of whack.
Instructor
Joined: Oct 2016
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From: Oregon
Hold on a sec, I see where you went with that, but I suggest we also need to keep in mind that the leasing company bought the car that you're leasing. The leasing company is not a charity, and they expect a return on the money that went into that purchase. So I suspect it's not as simple as just paying on the depreciating portion.
I do agree that leasing is probably simpler paperwork and you avoid the hassle of selling.