AUTO NOTES : MAY 2012 :
Despite the hype, most Americans know the the US Economic Crisis is not over yet. Smart economists are preparing themselves for what is now being called "US Economic Crisis 2.0" due to hit sometime in 2012. Massive inflation is expected. The prediction is interest rates will soar - reminiscent of the 1980 financial crisis. Several experts expose the problems; everyone is placing blame; no one is offering solutions.

If you want to save money on your single most expensive item in life - your personal transportation - get real and face the facts... facts which may contradict what you think now, but are wholly proven in articles below:

• You can't keep one car forever. All used cars end up in the junkyard some day. Along the way, maintenance costs will exceed the cost of a new one.
• No matter how much you pay, the only value you can receive from a car is the use of it, but you don't have to own your vehicle to get the full use of it.
• Auto ownership is financially detrimental. It is unwise to invest in a depreciating asset. Leasing allows you to pay for only the use of your auto.
• Leasing a series of 26 vehicles and investing the 42% savings over a driving lifetime of 60-years, will make a $250K difference in your net worth.
• Like auto loans, there are good and bad leases. A bad lease costs less than the best loan, but only a good lease protects you all the way around.
• A good lease pays any accidental equity to you, protects from radical depreciation and avoids all maintenance costs through no-cost early termination.

Used vehicle prices ratcheted up 3% - 15% during March & April 2012 according to Time Magazine, US News & World Report, Consumer Reports, Kelly Blue Book, NADA, and other sources. US Motor Club members report price increases at the wholesale auctions of as much as $5,100.00 per week on high line models. Some agencies predict prices will fall or at least level off in the Summer, but that may be wishful thinking on their part since there really isn't a reason for prices to decline in the foreseeable future. A volume of low-priced cars obtained during the high volume new car sales period over the cusp of the year disappeared quickly. Either they were sold or they were marked up in latter day advertising. Pricing per model seems consist ant now, but guide book publishers who calculate current values based on historic sales records are thrown off the mark by the radical decrease and then increase during the last 5 months. Lately their Suggested Retail value has been far below their Private Party value and just over their Trade-In (Wholesale) value. Currently, there is a wide difference of opinion of used vehicle values among the guidebooks. They can't all be right; they could all be wrong, right?

The US Motor Club Board of Directors voted to use and promote NADA Used Vehicle Guidebook values in the coming months because NADA obtains their records directly from the dealers' audited financial statements monthly and the Manheim Auto Auction reports weekly. NADA, a nonprofit organization, is the only hands on industry leader. Our lenders use NADA to establish their loan values and residuals. Also NADA DATA is the only industry report made to the US Department of Commerce each year. They have to tell the truth, the whole truth and nothing but the truth there.

True Level Yield Leases combat high prices. Residual values are up, too. So are loan values on leases. A $1000 vehicle price increase costs less than $19 per month on a lease. If you think about it, you want 5 things and only 5 things from your personal automobile financing; 1) full use of your vehicle, 2) the lowest cost initially, monthly and all along, 3) the right to any equity established in your vehicle, 4) no liability for any inequity at trade time, and 5) flexibility to trade at virtually any time without a cost, without a loss, and without any contingent liability. Only a fair, level-yield, custom used car lease can give you all that.