Some luxury car buyers in Australia are apparently biting off more than they can chew, a recent News Limited article has reported. BMW Finance is currently pursuing around $18 million worth of luxury cars that have been bought by people who can no longer make the repayments.
BMW took 226 buyers to court last year, who were all facing bankruptcy, while an additional 21 buyers have been added to the list this year. The court actions were mainly associated with buyers of expensive cars, such as the BMW X5 and the BMW 5 Series.
A BMW spokesman said in the report that BMW mainly provided finance for more expensive vehicles, regardless of whether they were new or second-hand, BMW or other makes, and the common theme was people were buying vehicles out of their price range. BMW Finance says it had worked very hard to try to resolve payments with buyers before it resorted to legal action.
Debts are said to range from as little as $8000 up to $190,000. Reports say most of these court actions were with buyers owing around $30,000.
Bankruptcy experts say those in serious debt could now be facing repossession of not just the cars in question, but also goods at home and the home itself.
The report also says most of those in serious debt are from Generation Y.
It's a sad story, especially when these buyers are so young. Buyers from this segment want the dreamy lifestyle as soon as possible, but acting too soon is getting them into serious debt.
As always, take your time during the buying process and make sure you are in a secure position to go into debt, if that's what you decide to do.