Although news on established lenders dominates the world of car loans, once in a while, there is a bright spot on the horizon related to alternative solutions for helping American individuals or households to get the transportation they need at prices they can afford. We covered one of these, a program called More than Wheels, a couple of months ago. In mid-August, the New York Times “Opinionator” section featured a follow-up story on how More than Wheels fits into the general array of options that Americans have for securing reliable transportation.
One of the questions raised in the August 16 story is whether people really need cars at all. But, as writer Lisa Margonelli points out, detailed studies provide a solid basis for the idea that most people need a personal car to get access to decent employment. More evidence for this is all around us, for example, in the cheap shuttles provided by temp agencies or other employers for low-wage individuals who do not have either a car or a current driver’s license. Generally speaking, to be without a car is to be in the more severe area of America’s poverty index, and many who lose their cars find themselves in a downward spiral, which is one of the issues that the More than Wheels program aims to address.
Another element of the August 16 story involves outreach. It turns out that reaching American consumers took more effort on the part of the More than Wheels program than many would expect. The subtext here is that Americans are so unaccustomed to help from nearly any source that the first reaction, for many of them, was to be immediately suspicious. This is a whole other story in itself, but one that all of us, as Americans, need to pay close attention to.
A third element of the follow-up story presents an interesting question. New York Times readers wondered if there is a way for individuals with capital to put their money into the kinds of low interest car loans that help lower class families to get a ride. The clear answer to this is that while the venue already exists, the learning curve might be too steep. Individuals in America can already get lower interest auto loans and personal loans through micro-lending or peer-to-peer lending marketplaces over the Internet. The problem, for borrowers, is that most of these services require a lot of initiative on their part. Rather than just show up in a lender’s office, the borrower needs to create an attractive picture for their debt in order to garner individual peer-to-peer lenders and get sufficient funding for their loan.
Aside from evaluating how new and used car customers can get the best deals from dealerships and third-party lenders, it’s useful to also take a look at how lower income customers can utilize alternatives that are out there. It’s all part of helping the full range of drivers to get what they need in a diverse and fast-changing auto market. After all, the automotive industry is a major element of the American economy in more than one way, and as in other major markets, education is critical in getting access to the best deals. Stay informed and profit from the best that today’s market has to offer.