My Car Loan Nightmare
A Temporary Employer Insisted I Get an Auto Loan. The Damage Was Quite Permanent.
In my first autumn out of college, I got a job working for the campaign of a state school board candidate in the Gulf Coast region of Texas.
An entry-level campaign hand, my job was pretty straightforward: accompany the candidate as she criss-crossed the district to attend various campaign events—a rodeo here, a school council meeting there. It was not my dream job. In fact, it was glorified temp work. But that didn’t stop the consultants who’d hired me from insisting that I procure, as a part of my duties, a permanent set of wheels.
Unfortunately, the idea of buying a reliable car from a suitably reputable source was totally foreign to me. Following the breakdown of my ’89 Volvo 240 a few years before, I was more than happy to spend the intervening time attending school in Austin with my trusty bicycle as my only means of transportation. But now, on the verge of gainful employment, I was becoming more open to all that “adulting” entailed—even if my circumstances gave me a number of immediate concerns.
… How will I pay for a car long-term if we lose the campaign and I’m out of a job?
… What if we win and the consulting firm that hired me doesn’t bring me on full-time?
… What if I don’t even qualify for getting a car in the first place?
With these questions swirling in my head, I did what I imagined people do when they wanted to weigh the pros and cons of buying a car: I went to have a conversation with a local dealership that I surmised offered the most affordable models available.
I arrived at the dealership—my lack of professional permanence prominently on my mind—and wasted no time inquiring about short-term leasing options. Unfortunately, I quickly discovered that my idea of “short-term” was very different than the multi-year choices available in 2013, and that my lack of good credit rendered those a non-starter anyway.
My credit wasn’t terrible, mind you. Just not particularly great—thanks to a few missed credit card payments during the recession and a healthy amount of student loan debt that was affixed to my credit profile like a financial scarlet letter.
While options that accommodated the temporary realities of my job were non-existent, the sales guy promised he could get me behind the wheel of a new Dodge Dart right away if I signed a six-year loan with their banking partner.
The idea, at first, seemed asinine. I had no idea where I’d be following the election, let alone when the debt from this purchase would finally be off my shoulders (although I knew I’d be well into my 30s). With no better option available, though, I had little choice but to hold my breath and do what seemed to be the grown-up thing at that moment: I signed on the dotted line for this 2013 jet black compact sedan, which had presented no particular bonding moments during a brief test drive, but that was now set to define me for the better part of the next decade.
I thought I had adequately considered the downside consequences of this level of vehicular commitment. At worst, the job would be fleeting and I could justifiably reason my way through a missed payment or two while I scrambled to find my next gig. Sure, my credit score might take a hit, but after what I learned at the dealership about my track record on that front, the damage had obviously long been done.
I thought about how a car loan might help my credit, but ultimately, it was one of the worst decisions I ever made
So with my new wheels, I started my job. Initially, it played out exactly as told to me. I drove town-to-town across Texas with our candidate, meeting and kibitzing with folks who were perfectly nice—even if they may not have been even vaguely aware that a fevered education board race was under way. Three months into the campaign, however, I got a phone call from our office in Austin that I definitely did not expect.
“We’re moving in a different direction, and we need you to resign immediately,” they said.
I was blindsided. To this day I have only a scant idea as to why they slimmed the campaign and consolidated the operation—aside from the later revelation that my candidate lost resoundingly. Nonetheless, it left me with a pit in my stomach and a shiny, new Dodge Dart that I had no idea how to pay for—and which now did me as much good as the pile of tailored suits currently residing in its trunk.
So, after batting the idea around for a couple of weeks, I made a very tough call to the bank so they could have their repo guy come out and pick up the Dart. That decision still follows me around five years later. My ability to get a decent APR puts the prospect of purchasing a big-ticket item well out of reach. Applying for an apartment comes with the expectation that I’ll be asked to pay double the listed deposit. And let’s not even get into the idea that I might be able buy a home one day. That conversation is downright depressing.
It's crazy to think your employers demand complete flexibility, while creditors demand a six-year commitment
Add to this the ability of would-be employers to request information on my borrowing behavior—and my own inability to refinance other onerous loans—and it’s safe to say my purchase of that 2013 Dodge Dart might, in the grand scheme of things, be one of the worst decisions I ever made.
Somewhat ironically, I now work at Fair. And had its no-loan, turn-it-in-whenever version of car access been available in Texas all those years ago, I can honestly say my life would be different. Don’t worry, I’m certainly happy enough. But frugality is likely to be a big part of my life for the foreseeable future.
The “Dart incident” was not without its lessons. Fact is, there simply wasn’t enough information about predatory lending back then. Believe me, I’ve since gained a much better understanding of the real price that car loan cost me.
I sometimes daydream about how different my conversation with that bank in Texas could have been had a more flexible car option existed back then. In fact, I could have simply called and given them the simple statement I’ve given to any number of service providers over the years when I wanted to end our agreement: “I’m moving in a different direction.”
Then my life today certainly would be.