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Stimulus program results in high repo rate

Fri, 01/22/2010 - 17:50 — Consumers Law

According to a recent research study, the Cash-for-Clunkers program resulted in high rates of repossessions for new car buyers.  From USA Today: "Higher credit risk buyers who used the government's cash-for-clunkers program last year to buy a new car had higher repossession and late payment rates than those who didn't use the program.."

Of course, sub-prime borrowers are visited most by the repo man. According to the article:

Among subprime credit borrowers, those who used the clunkers program had a 4.8% repo rate, more than double the 2.2% who bought similar vehicles but didn't use the government incentives.

Click here to learn more about your rights when it comes to auto repossession.