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How the Payment Box Allowed Me to Buy a Car

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By Darren Stevens

I thought my story might help some people who find themselves in a similar situation. I was recently able to get a car because of the payment box when I likely wouldn’t have been able to any other way. Getting that car was vitally important because it allowed me to keep my job, which in turn allows me to pay for my apartment and stay off the streets. It’s a rather long and complicated story, but I will give you the concise version to give you a bit of background.

I’ve been in and out of the hospital for some years now due to chronic illness. The illness has also led to me having huge medical bills and even filing for bankruptcy. Due to all of this, my credit isn’t what could be called close to being good. It’s terrible, and that makes it difficult for me to qualify for any credit or loan. That hasn’t been a problem because I went to an all-cash system that had been working well. That was until my employer decided to move locations which meant that I would no longer be able to take public transportation to work.

The only option I had was to get a car or lose my job. I was terrified because I thought there was no way I could qualify with my credit history. Then I remembered an article Tricia wrote about payment boxes when they first came out years ago. Since my choice was to have a job and a roof over my head or not, I immediately went searching to see if I could find something that could help me get a reliable used car that would get me to and from work each day.

For those not familiar, a payment box is a device that lenders place in the car that give them control of whether or not the car starts. , it allows lenders to disable your car so that it won’t run if you don’t make a payment that’s due. While this sounds like a terrible thing for the car owner, for me it was a lifesaver. That’s because the payment box gives the lender some control over getting payments, so they’re willing to give people like me who have terrible credit a loan when otherwise it wouldn’t be worth the risk.

By having control of the car, it mitigates their risk and allows them to easily disable the car. It won’t start if a payment is missed, and to recover the car (the device also has a GPS tracking system) if a missed payment isn’t immediately made. On my side, as long as I make the monthly payments on time, there is no issue, and I have a car that gets me to and from work. With these safeguards, they’re willing to make a loan to someone they might not normally approve. To qualify, I had to show my paycheck stubs to prove that I could make payments.

There are a lot of people who think that payment boxes are a bad idea. I read a survey conducted by Stoneacre that said the public is still evenly divided on whether or not this is a good idea. It said that 35 percent of people thought the payment box is a good idea, 34 percent thought it’s an invasion of privacy, and 31 percent had no specific view on it. My guess is that those who though it was a bad idea or an invasion of privacy have never been in a position where they couldn’t get a car they needed without this option.

I must admit that I would prefer not to have the box in my car. They claim they only use the GPS capabilities if they need to repossess the car, but that doesn’t mean the NSA doesn’t have access to it. I’d rather there not be a possibility of someone knowing where I am at any time. If, however, the choice is that or living on the streets because I can’t get to my job, I’ll gladly accept the conditions.

So you may be wondering why I’m writing this for BAD. I wanted people to know that not all people who have terrible credit are people who just racked up credit card debt and decided not to pay, or people who don’t understand how credit works. Not everyone who gets a bad credit car loan is someone who is lazy and didn’t have what it takes to organize their finances. Until I came down with my illness, I had great credit, and I’d never failed to pay a bill on time. When you get sick, and your choice is getting the medication you need to stay alive or paying a bill that has come due, priorities change pretty fast.

There are some of us who were thrust into the poor credit world because of the genes our parents gave us without ever intending to get anywhere near it. I hear from a lot of people who say that those with bad credit shouldn’t be able to get any credit because they have already shown they aren’t reliable, and they should live with the consequences of their prior choices. The truth is that there isn’t a one-size fits all designation as to why people have credit problems. And if the system didn’t find ways to try to help those who do have bad credit, I would probably be living under a bridge somewhere instead of having a job, paying taxes and being able to contribute to my community.


Some Simple Ways I Reduced My Debt and Everyday Living Expenses

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By Martin Fine

Almost all of us reading BAD have struggled financially at one time or another. Most of us who have found our way here try to spend more frugally, but it wasn’t always that way for me. There was a time when I lived with the attitude that the money doesn’t go with me to the grave. While living like the later may have been more enjoyable in the moment, it’s was stressful day in and day our when I didn’t have money to pay the bills and caused me to take out ill advised loans and to sell things I wish I hadn’t.

Here are some simple ways that I have reduced debt over the years.

Rent: If you are paying rent like I do you can’t be afraid of your landlord. Let the landlord know that times are tough and ask for a rent reduction if you sign a longer term lease. By doing this, the landlord let me save $50.00 a month for signing on for another year. A savings of $600 just for asking. There is a theory that if you ask you have a chance of receiving. If you keep quiet you will never know. Remember you miss 100% of the shots you don’t take. If you are paying your mortgage each month check out the possibility of refinancing and getting a lower rate than certainly explore this possibility.

Water Bill: I found that my water bill fluctuated a lot. The culprits? Well showering too long, leaving the hose on, and not repairing leaks were some of the culprits, Addressing these issues have saved me $100 so far this calendar year (pro rated). While all of these “leaks” were tiny, when I tightened everything the monthly bills started to go down.

Electricity: Always know that in the summer and the winter there are ways to save on electricity. A few things like using less natural gas, pellet stoves, and buying energy savers like LED light bulbs and adjusting your devices. In fact there are over 100 different tips (PDF) from First Energy Corporation that I used such as adjusting my thermostat and saving $65.00 so far this calendar year.

Health Insurance: There’s no price you can put on your life right? Well, that is correct, but you also don’t have to overpay. I called my representative and let them know times are tough and again ask to save. While I only was able to squeeze out $5.00 a month savings when I pleaded my case, it was still an extra $60 in my pocket.

Renters Insurance: I never opt for additional insurance and you shouldn’t either. This is a tough call and I think it depends a lot of what you own, but I opted to cancel mine and go without. Renters insurance isn’t too expensive, but I needed to save every dollar I could. It was a chance. Had something happened, I would have been on the hook, but I thought it was worth teh risk since I didn’t have anything that was too expensive to replace. I took a pass and rolled the dice and it worked out for me.

Entertainment & Meals: When I was at the Naval academy I learned that the best food is free food. While only when others are looking for business advice do I receive those free meals. So when I am on my own I check out deals on Groupon and Restaurant.com which offer all sorts of great specials and deals for when you eat out. If you are not too health conscious shopping at the secondary grocery stores and buying the BOGO (buy one get one deals) always pays off. Once I lived off of Pasta, Rice, and Shrimp. I spent $25.00 and it fed me for a whole month. Yes you read that correctly. Maybe take a month to test it out and see how much you can save on food and take the Pasta, Shrimp, and rice challenge.

Gas & Car Expenses: GasBuddy is a site that you hear all about when Gas Prices are at all-time highs, but what about when they are low? Well that’s where the frugal mindset looking to pay off debt comes in. I make sure to save money by shopping out the cheapest gas year round not just when prices are high.

I had a difficult choice to make when things were tightest. I had a settlement that was paying me a small amount each month that I relied on, and I was tempted to cash it in. That would have been the easiest way to handle the situation. I considered it enough to search the pros and cons of a loan against my lawsuit settlement, but ultimately decided against it. I count on that small amount monthly, and if I cashed it out, I would have had money now, but lost the income each month. It initially seemed a good idea, but taking up more sound financial debt reduction ideas like the ones stated above was a more feasible long term solution for me.

The thing I learned most was that the easy solution isn’t always the best solution. Taking steps to make my overall finances more sound was the best move I could make even though it took a bit more work. Those are savings I will be able to keep without having to give up anything in return which was the best move for me.