SANTA MONICA, Calif., April 16, 2019 /PRNewswire/ -- According to the New York Federal Reserve, more than 7 million Americans were 90 or more days behind on their auto loan payments at the end of 2018. Today, Car-as-a-Service provider Fair revealed the surprising results of a new online consumer survey conducted on their behalf by The Harris Poll among over 2,000 U.S. adults, showing that auto loans are a source of emotional stress and anxiety for many Americans. The results also show that Americans would be willing to give up many simple pleasures for life—even social media and coffee—to never have another auto loan payment again.
The perceived stress of auto loans is especially prevalent among Millennials (ages 18-34). These younger consumers are more likely than their older counterparts to have negative perceptions about auto loans and to believe that auto loans have harmful impacts upon their well-being.
"In an era of cord-cutting and a consumer culture that increasingly values experiences over assets, taking out a five- or six-year loan to get a car has never made less sense," said Ed Brojerdi, Global Head of Brand for Fair. "This survey sheds light on why we at Fair are committed to eradicating auto debt with a totally new way to get an affordable pre-owned car that prioritizes flexibility, freedom and fairness."
Fair is an app that puts the entire end-to-end process of getting a pre-owned car on a customer's phone, without the long-term commitment, debt, or even physical paperwork of the traditional process. Users can shop pre-owned cars with all-in monthly payments they can afford, sign for the one they want with their finger, pick up their keys, and pay only as long as they want to drive it, with the ability to turn the car in whenever they want.
"Having access to a reliable car shouldn't be complicated, expensive or stressful—and our financial obligations must be able to adapt to the changes in our lives," said Scott Painter, Founder and CEO of Fair. "This survey has revealed surprising and vivid insights around the anxiety of being forced into debt to get a car, which is an antiquated and often unfair proposition that has no place in the life of a modern consumer."
Key findings of the Impact of Auto Debt in America survey include:
Auto loans are a stress factor in many people's lives and have caused negative impacts in various areas—including personal finances, mental and emotional health, and romantic and sexual relationships:
- Over 2 in 5 vehicle owners (42%) say auto loans have caused them to experience stress.
- 36% of Americans believe that having auto loan debt is more stressful than finding a new job.
- Nearly 1 in 3 vehicle owners (28%) say buying a brand-new vehicle is one of their biggest financial regrets.
- Nearly one quarter of those who've had auto loan debt (22%) say having auto loan debt has negatively impacted their mental/emotional health.
- 12% of those who've had auto loan debt say that debt has negatively impacted their romantic relationships/sex life.
- Nearly half (47%) of Americans who have had auto loan debt say it has taken away some of their peace of mind.
- More than 1 in 10 Americans (13%) get anxiety just thinking about paying auto loans.
The stresses of auto loans are especially intense for Millennials (ages 18-34):
- Millennials are more than twice as likely as those ages 35+ to get anxiety just thinking about paying auto loans (22% vs. 9%).
- Nearly half of Millennials who have purchased a vehicle (49%) say auto loans have caused them stress (vs. 35% of vehicle buyers ages 55+).
- Millennial auto loan debtors are more than 4 times as likely as those ages 35+ to say having auto loan debt had negative impacts on their romantic relationships/sex life (28% vs. 6%).
- Millennials who've had an auto loan are about twice as likely as those ages 35+ to say they felt regretful immediately after signing their auto loan (19% vs. 8%).
Americans are prepared to make some surprising trade-offs to avoid auto debt, and many even find it more painful than going to work naked:
- More than half of Americans who've had auto loan debt (52%) say it has caused them to make sacrifices when it comes to vacations and travel plans.
- 3 in 10 Americans (30%) would give up social media for life if it meant they never had to make another auto loan payment again.
- 24% would give up coffee, and 22% would give up streaming services for life in exchange for never having to pay off an auto loan again.
- Over a third of Americans (34%) think going to work naked for a day would be less painful than having monthly auto loan payments for 5 years. Nearly half of Millennials (47%) think going to work naked for a day is less painful than 5 years of monthly auto loan payments, compared to 22% of those ages 45+.
For more information on the dangers of auto debt, visit https://www.fair.com/blog/auto-debt-dangers.
About The Impact of Auto Debt in America Poll
This survey was conducted online within the United States by The Harris Poll on behalf of Fair from March 11-13, 2019, with 2,043 adults ages 18 and older, among whom 1,574 have ever had auto loan debt. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact Yasmin Moaven.
Fair offers a new way to get a car that responds to consumer demand for more freedom. Fair gives customers the flexibility to drive the car they want for as long as they want and lets them walk away any time, eliminating the long-term commitment of traditional financing or leasing. Fair allows you to select your car, miles and view your payments—all in a mobile and paperless end-to-end experience that's simple, transparent and affordable. Fair is headquartered in Santa Monica, California. For more information, please visit www.fair.com and follow them on Twitter at @fairtheapp.