Car loans are easier to get -- but still stupid!

Easy car loans make it simple for consumers to but new cars like theseThe Wall Street Journal is reporting (subscription required) that there is a thawing in the car loan market, which is making it easier for people to get car loans at lower rates than were available at the height of the credit crunch.

According to the Journal, "The recovery in the auto credit market is the result of various factors, analysts say. A program launched by the Federal Reserve to jump start demand for securities backed by car loans worked, and slowly allowed auto makers' finance companies to once again raise capital for new loans by selling off their old ones."
While the more widespread availability of auto financing is certainly good news for people who make their living selling cars, here's the truth: if you have the goal of ever being rich, borrowing money to buy a car is one of the dumbest things you can do.

The average millionaire drives a Toyota or Ford F-150 pickup truck -- and not a new model. That's how they got to be millionaires: they paid cash for used cars and when they did borrow money, they borrowed only to acquire assets that would go up in value (i.e. real estate).

Please, please, please: don't "take advantage" of these "low rates" to buy a car you can't afford to pay for with cash. The depreciation on new cars more than offsets the benefits of "0% financing".
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