We publish an auto lender review guide to help buyers see current rates from top nationwide lenders.
For your convenience, here is data on what rates looked like across Q2 of 2022.
|Super Prime||781 - 850||2.96%||3.68%|
|Prime||661 - 780||4.03%||5.53%|
|Nonprime||601 - 660||6.57%||10.33%|
|Subprime||501 - 600||9.75%||16.85%|
|Deep Subprime||300 - 500||12.84%||20.43%|
Source: Experian 2022 Q2 data, published in August of 2022
For historical comparison, here is what the data looked like in Q1 of 2020 as the COVID-19 crisis spread across the United States.
|Super Prime||720 or higher||3.65%||4.29%|
|Prime||660 - 719||4.68%||6.04%|
|Nonprime||620 - 659||7.65%||11.26%|
|Subprime||580 - 619||11.92%||17.74%|
|Deep Subprime||579 or lower||14.39%||20.45%|
Source: Experian 2020 Q1 data, published on August 16, 2020
Across the industry, on average automotive dealers make more money selling loans at inflated rates than they make from selling cars. Before you sign a loan agreement with a dealership you should contact a community credit union or bank and see how they compare. You can often save thousands of dollars by getting a quote from a trusted financial institution instead of going with the hard sell financing you will get at an auto dealership.
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In previous decades, people rarely worked more than a handful of miles from their homes. Food was grown at home, stored in a cellar or bought at a local market. The world is growing more and more globalized every year, and as cities grow, people have to travel. It's simply not possible to live within a certain radius of everything a person needs. If they live in the city, they may be within easy walking distance of their job, but the traffic, weather and job conditions don't always allow it. Meanwhile, if they live in the country, they might drive half an hour, an hour or more just to get to work. The costs of transportation add up. Why not explore alternative transportation options?
The Department of Labor has a branch called the Bureau of Labor Statistics. According to a table published in 2010, a full fifteen percent of the total expenditures of an average American home is a car and related expenses. The only higher expense is shelter, in the form of a mortgage or rent payments. Think about all of the expenses related to car ownership.
Some of these costs can be mitigated. Buying an old used car will help eliminate most of the car payments, but will end up costing more in repairs and maintenance. A new car probably won't need repairs, but will cost more in insurance. Driving safe will lower insurance costs, but won't prevent every accident.
Another consideration for basic car ownership is the efficiency of the car. A solid old car with low payments may end up guzzling gas at a rate far higher than a more expensive new car. Over time these costs add up. Gas mileage is very important for calculating the cost of driving a car. A hybrid vehicle has a number of advantages in this respect, but suffers from extremely high introductory costs and the need for special fuels or electrical access. They also require specialized maintenance, which increases those costs. Overall, it might simply be best to opt for an alternative method of transportation.
A person living miles out in the countryside may not have access to any form of public transportation. Metro transit authorities generally have fixed routes within a city center, taking advantage of the largest concentrations of people needing rides. It simply isn't worth their time or money to cover every square mile of the countryside. That said, if a person lives inside the area covered by a metro transit system, it might be well worth the walk to a bus stop, train station or subway.
The most common form of metro transit in most cities is the typical bus. Bus systems have a number of distinct advantages over a personal automobile. A passenger does not need to pay for gas, insurance or maintenance of the bus they ride. The only expense they pay is the fee for riding, generally only a dollar or so per ride. Many bus systems offer day passes, punch cards or monthly passes for regular passengers. Even at a high cost, these passes are still much less expensive than just paying for gas for a corresponding amount of time. In some cases, they will even offer free rides to local students with ID, senior citizen discounts and other benefits.
Bus systems have their failings. Passengers are reliant on the times the bus runs. If they have to work on a holiday where the bus runs, they are out of luck. Likewise, if the bus is stuck in traffic, breaks down or is in an accident, the resulting delay can make passengers late to work, with negative consequences. Passengers are also reliant on the locations the bus runs and stops. Sometimes the nearest bus stop is still a block or two away, making it less convenient to get to. Of course, passengers who value their privacy and personal space may find a crowded bus to be too much of a source of stress to make regular riding worth it.
Rail lines are only available in some major cities. Many smaller cities do not have a regular train service, meaning people who live in these smaller cities or in areas with no train service do not have this option. For those who can access a train system, they have plenty of perks. Trains and subways tend to run all day every day, regardless of holiday or weather. It means that hours are much more flexible for passengers with non-standard schedules. Train stations have conveniences of their own that a regular bus line does not, such as snack bars or easy access to other methods of transportation. Much of the annoyances of a crowded bus are eliminated in a rail system, though not all of them. Crowding can still be an issue.
Trains might be more expensive than bus systems, or they might not, depending on the location. They are often dirtier than buses, due to the higher volume and constant run time. Trains are also limited to their tracks. Many pedestrians taking trains need to transition to another mode of transportation to and from the platforms at either end of the station. Disruptions to a train track are also much harder to deal with for a train than a bus, but they are thankfully rare.
Zipcar is the name of a new service that is growing in popularity. Rather than car-pooling, Zipcar offers car sharing. The idea is that a person can pay for a membership and is issued an electronic card. This card allows them to access a Zipcar lot and unlock a specific vehicle. They are then able to take and drive this car as they would any other vehicle. The plans include fuel and insurance, and the payment for a Zipcar membership is far less than the payments required to purchase and own or lease a car.
Zipcar offers several plans, which vary in cost according to projected use. The problems with driving a Zipcar are all the same with driving a car owned by the driver. The driver still has to deal with traffic, the distance and time of the commute, parking and other such concerns. However, using a Zipcar service to "rent" a car is far cheaper than purchasing a car to begin with.
Car-pooling is a way for car owners to help each other in their commute with some form of compensation. Generally the owner of the vehicle requests a payment of some kind, be it gas or maintenance costs split among the people riding along. For the driver, a car pool does nothing to change the standard pros and cons of driving a car, except for lowering the general costs. On the other hand, the driver must now deal with having people in their car, potentially strangers or people they do not get along with.
For riders, car-pooling helps eliminate the stress of a daily commute. They are also given an excuse to leave work at a regular time, meaning they can't stay late for overtime. However, it also requires a commitment to this punctuality, for being picked up both before and after work. There are also laws that govern car-pooling in some states, especially those with dedicated car pool lanes. A driver needs to have a certain number of people in the car for it to be considered a car pool.
Car pools are also social contracts. If one or two people back out of the contract, it is easy for the whole thing to fall through. This inconsistency makes car-pooling a less than ideal option for many people. Passengers are also unable to run specific errands on the way to or from work, because the other people do not want to wait. In fact, other passengers are one of the largest drawbacks to car-pooling. The spread of gossip, the close proximity of bad habits such as smoking and the greater chance of infection when one member gets sick are all reasons many people avoid car-pooling.
A motorcycle, dirt bike, moped or other small motor vehicle is another possible alternative mode of transportation. However, they are also a way of life. Many bikers are not in it for the convenience, but rather the pleasure of riding their bikes. Motorcycles most of the time require special licenses and permits to ride legally on the road. They also require the same sort of insurance, gas and maintenance issues as cars. However, for motorcycles these costs are generally lower. An expensive motorcycle and an expensive car are two entirely different classes of expensive.
Possibly the worst thing going against motorcycles of all types is the weather. Riding exposed with no heat, relying on protective clothing to keep them warm, is liable to be very uncomfortable for many commuters.
"True" motorcycles in this context range from the massive machines made by Harley Davidson to the more race-oriented bikes by Kawasaki, and everything in between. These machines are all in one general category as far as the law is concerned. They have similar fuel requirements, insurance costs, maintenance costs and the like.
Motorcycles require gear that cars do not. From helmets to jackets to protective pads, riders must protect themselves from the possibility of injury in a collision. The driver of a car is inside a large safety device, and is thus far safer. Motorcycles burn fuel less efficiently than cars, but at a lower rate. This means they use less fuel than cars, but they cause more pollution as they do so. The noise is also a factor -- not every commuter wants to ride a machine that blasts a loud noise constantly as they drive.
Mopeds, scooters, Vespas and other small motorbikes are an alternative to larger motorcycles. These bikes are smaller, lighter and generally more efficient machines than the larger bikes. However, they are also slower. This makes them much more efficient at local travel, like within the boundaries of a city. They work well as a short-range travel method, especially in the warmer months and climates. Where a car may get 20-30 miles per gallon of gas, a typical moped will pull in closer to 70.
Smaller motorbikes like Vespas are a particular fashion statement as well. Some commuters may not want to be seen riding one, while others may take pride in it. Pride isn't the only consideration. Small scooters have very little storage space, making it harder to run large errands such as grocery shopping with one. It is not impossible, but it is more difficult than with a car.
The smallest scooters are little more than a platform with a steering column, a drive wheel and a small motor. These devices travel around ten miles per hour and work as a reasonable short distance transportation option. They have no storage space and are not very fast, but they are able to be carried easily in and out of buildings. A kick scooter can turn a ten-minute walk into a three-minute ride, like a bicycle without the physical effort involved. However, they are completely exposed so the rider would need safety equipment and weather protection, if they can even ride in adverse conditions.
Snowmobiles are only a valid method of transportation in certain northerly areas of the world. In some cities, they become more popular than cars in the winter months. In others, they are strictly a recreational vehicle and have no place as a commuter device. They still require the purchase, fuel, maintenance and other concerns of nearly any other mode of transportation, so they are less than ideal for the majority of commuters.
Pedal bikes are growing in popularity, and it's easy to see why. They're incredibly cheap compared to any other method of transportation. They are small and easy to maintain. They do not require any gas. Insurance on them is optional. Protective clothing is cheap and mostly unnecessary. They're an incredibly green method of transportation and they help make their rider healthier along the way.
Bikes do have their drawbacks. Weather is one of the biggest. If a commuter tries to bike to work in the rain, they have to deal with wearing a bulky poncho, arriving to work soaked to the skin or bringing a change of clothing with them. In fact, even during dry weather, a change of clothing is not uncommon. Few businessmen want to bike in their suits, though some do. Some would greatly enjoy a shower at their destination as well, to clean off the grime of the exertion a bike ride requires. Not all of these conveniences are available everywhere.
Bikes are also easy to steal. Many people secure their bikes with simple chains and padlocks, but a pair of bolt cutters can slice through these protections in seconds, allowing a thief the ability to ride away within a minute. Cars are stolen every day as well, but they are much easier to track down and recover, and insurance covers that sort of event. Bike insurance rarely covers theft, because it is so easy. Bikes are rarely recovered in ride-able condition, if at all.
Biking is very healthy, as long as a moderate amount of effort is used in the trip. A bike ride of half a mile all downhill will burn no more calories than riding a car down the same hill. An average bike ride of an hour in length will burn 350+ calories, depending on the amount of effort it takes. Bikes that are more expensive will have smoother rides and will weigh less, which means it takes less effort to ride. That means they burn less calories, but the benefits outweigh the negatives. Bikes are a very healthy method of transportation, especially within a small area. Of course, bikes also lack the storage space of a car, making errand running difficult.
Walking is the most basic form of transportation imaginable. It requires no license, no insurance, no special gear, no fuel and nothing else. It burns calories at a rate of 85 per mile walked, more if the walker is in a hurry. That said, it also takes a reasonable amount of time to walk short distances, but long distances are harder to handle. If a walker lives more than a few miles from their destinations, the trip becomes a whole day affair. Thankfully, there are a few options that serve as alternatives to simple walking without the expenses of motor vehicles.
Jogging and running are excellent for multiple reasons. They cover distance faster than walking. They burn more calories as well. Running a leisurely pace can still burn as many as 900 calories an hour. Of course, these methods also require a few accessories. For hot days, some means of carrying water is recommended. In all conditions, a good solid pair of supportive running shoes goes a long way toward preventing injury to the legs and feet. Running is also hazardous in wet or icy conditions, making it more ideal for a summertime transportation method.
Roller skates or roller blades are a wheeled alternative to walking with a few pros and a few cons. On the one hand, they are faster than walking and even running. They require just as little gear -- just the skates themselves, a helmet and some protective pads. Skating is burns calories and works as a great means of exercise over moderate distances.
The down side of skates is their limitations. Skates need flat surfaces to work well. It's hard to skate on gravel or dirt roads, broken sidewalks or grass. Steep uphill climbs can be almost impossible to skate up, and require removing the skates and walking. Steep downhill descents conversely are easy to skate down, but can be very dangerous, especially if the area is heavily trafficked. Skates are also inconvenient and hard to use in adverse weather conditions.
When thinking of boards for personal transportation, many might think of a skateboard, but in reality, a skateboard is far from a vehicle. Skateboards are more for performing tricks than they are for transportation, the same way a BMX bike is different from a road bike. Longboards are the ideal board for personal transportation. Longboards are much more stable and much more maneuverable than skateboards, giving them a great degree of motion. They can reach reasonably fast speeds, for a non-motor vehicle, but they can be stopped at any time with a simple kick. They are mostly appealing to older folks who used skateboards in their youth, giving them a means of transportation they are familiar with.
Longboards suffer from all the same negative points as any other pedestrian transportation. They have no weather protection, and often cannot be used in bad weather at all. Cold weather is unpleasant, and if there is snow on the ground, it is impossible to ride. Difficult hills are hard to board up and dangerous to board down. The rider would need protective gear to assure their safety as a matter of course.
Hitching a ride is an older method of transportation that is greatly out of favor today. Many people distrust hitchhikers, fearing violence or instability. It is easier to hook up with a car-pooling group. One of the biggest problems with hitch hiking is the inconsistency. Some days a ride might pull over immediately, while other days no one will stop.
In some areas of the country, it is entirely possible to ride a horse to work. Horses have plenty of benefits over cars. They can travel quickly without burning up fuel or polluting the atmosphere. They are relatively safe. There are no maintenance or license costs using one as a vehicle.
On the other hand, a horse is a living creature. This means it needs food and shelter all year round, with the possibility of medical attention being required at any time. Horses also age just like any other living creature, and can't have the life put back into them with spare parts the way a car can. While perfect for Amish country, a horse is a less than ideal alternative to a car.
While not strictly a method of transportation, many people are choosing to work from home these days. Some of them get special permission from their jobs to work at home for some select days of the week. Others work jobs that are completely based in their home office, such as contract work. Still others run their own businesses out of their homes. All of these alternatives cut back on the use of vehicles by dint of cutting back on commutes.
Working from home has downsides of its own. It takes a significant amount of discipline to work every day from home, ignoring all of the distractions of home life. Even simple things like the radio or television can be the difference between a successful home job and a failed experiment. Family only complicates matters, especially if the home worker doesn't have a home office they can close themselves in for work.
Many of these methods can be combined. Walking short distances to a car pool, for example. Taking a bike to a bus or train stop and carrying it on board helps as well. Bus and train routes can overlap to a degree, allowing the commuter a degree of choice. Jogging, skating, boarding and biking are all interchangeable with walking to a degree, as long as the distances are short enough. In general, a solid combination of the above methods is a realistic alternative to using a car all the time. Very few people can adapt to strictly using public transit, just biking, or walking everywhere.
Hybrid cars come in many varieties. Some use gas and ethanol. Others use batteries that charge through braking and power cords to work with a gas engine. Some are gas and hydrogen, though many of them are slowly emerging technology.
Hybrid cars, as well as straight electric cars, are likely the future of automobiles. However, they are not generally an effective alternative to purely gas-fueled vehicles today. It's true that the current generation of hybrid cars is more fuel-efficient than purely gas cars. They get more distance per gallon of fuel. They don't pump as many greenhouse gasses and pollutants into the atmosphere.
The other side of hybrids is the initial cost. Hybrid vehicles are significantly more expensive than corresponding new models of gas vehicles. While the savings on fuel costs may slowly recoup that cost, it will take a long time for that difference to tip from investment to profit.
Many people want to invest in a hybrid vehicle in order to help the environment. While it's true that having fewer gas-burning cars on the road helps the environment somewhat, one has to ask where the fuel comes from. Hybrids that use ethanol or electricity still get that power from somewhere. The ethanol or electricity comes from some production facility, a facility that uses power of its own. At the root of this chain, eventually the power has to come from somewhere.
This power might come initially from the burning of coal or natural gas. That means the power is putting greenhouse gasses into the air to begin with. On the other hand, more and more power is being generated from wind, solar or nuclear generators, making it much cleaner energy. In the end, hybrids probably save a degree of pollution from the environment, but perhaps not as much as the average consumer believes.
Biking and walking are both excellent alternative methods of transportation over short to medium distances. They also have a number of side benefits. Too many people today are overweight and struggle with diets and exercise plans to try to get healthier. Meanwhile they struggle with the expense of car ownership, the stress of a daily commute and the hassle of constant repairs and fueling.
All of these problems can be solved by switching to walking, biking or one of the other pedestrian modes of transportation. Someone walking or riding a bike has to deal with traffic much less frequently, and when cars are backed up, a bike can still proceed along a shoulder or sidewalk. Meanwhile, biking or walking is burning calories while sitting in a car is not. As mentioned above, walking at a moderate pace will burn 85 or so calories per mile. Jogging will burn ten times that, and biking at a reasonable pace will burn around 350. All of this makes the physical activity of pedestrian transportation a much healthier option.
In the end, there are some things an alternate method of transportation simply cannot replicate. The utility of a car or truck is irreplaceable for hauling large objects and traveling long distances. In the widespread, globalized society we have built, it is unlikely that anyone can switch from using a car to never using one without a significant lifestyle change. That said, commutes and other short distance travels could be made much easier and healthier with an alternate mode of short range transportation as an option.