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Love to spend my afternoons unwinding skeezy auto financing deals.
So the long story here is that my driver was caught on the wrong side of Qatar COVID blockade: he made the mistake of going to India for a wedding maybe three days before Qatar closed its borders.
Guys like Rasheed make good money -- way more than they could in India -- by driving people in private deals. Morning school runs, commutes for people too lazy to drive themselves etc.
But it's definitely a cash-in, cash-out affair.
But it's definitely a cash-in, cash-out affair.
The basic structure of the business is that he rents a car from a limousine company, pays them a flat fee, and drives as many people as many places as we he can during the month.
Every month, after he sends the bulk of his $ back home to his family, pays for a crappy room and some creature comforts to distract from the fact that he's far away from his family, he sets one or two hundred dollars aside for The Dream.
What if, The Dream goes, you didn't have to pay the limo company a cut?
Last year, he finally saved up for a down payment, and took his shot: a shiny new 2019 Honda Accord.
We were thrilled for him.
We were thrilled for him.
What I didn't know was that he had financed the rest of the car through his prior company.
COME ON MAN.
COME ON MAN.
Of course, like good middlemen, they didn't fund the loan themselves. No, they financed a loan through Honda and took a vig while intermediating between the finance company and Rasheed.
COME ON MAN.
COME ON MAN.
Anyhow, COVID hits and Rasheed is stuck outside the country. Not that being here would have helped: the driving-people-around industry has basically collapsed since everyone moved to working from home.
A couple of days ago, Rasheed asks if he can take an advance.
A couple of days ago, Rasheed asks if he can take an advance.
This is when the entire sordid affair comes out: the extortionate vig, threats to repossess, threats to his family *in* India.
So I offer to buy out the loan, and extend the duration of the loan.
So I offer to buy out the loan, and extend the duration of the loan.
Keep in mind, we are coordinating this over Whatsapp and my Malayalam is worse than my Hindi, which was not very good to begin with.
I call the middlemen, and offer to come by with a bundle of cash. No go.
I call Honda, who is non-committal. I drop by the office nonetheless, and pin their head of financing.
I call Honda, who is non-committal. I drop by the office nonetheless, and pin their head of financing.
It turns out car finance guys are pretty much the same everywhere in the world.
I offer to buy out Rasheed's loan for full face and he looks at me like I'm insane. The deal, he says, is securitized.
I offer to buy out Rasheed's loan for full face and he looks at me like I'm insane. The deal, he says, is securitized.
Yes! It is too expensive to rip off people individually, so car financing companies find it convenient to bundle extortionate loans together for easier bookkeeping.
I point out that the individual loan has a prepayment provision.
I'm exercising that right, and offering the penalty. I'm not trying to get a deal here, and I know I could: your financing book is probably falling apart right now.
I'm exercising that right, and offering the penalty. I'm not trying to get a deal here, and I know I could: your financing book is probably falling apart right now.
Finance guy is pissed now, he isn't used to people being able to, you know, read contracts.
He grumbles and gets some flunky to take my payment. By credit card (I'll come back to this in a bit).
And now we start playing games with titles. He says that he can only transfer the title to Rasheed's limo company.
I say that I want the title transferred to me. Immediately. Or I'm calling the cops, who *really* don't like people welching on debts here.
I say that I want the title transferred to me. Immediately. Or I'm calling the cops, who *really* don't like people welching on debts here.
More grumbling. He calls a person from the limo company into the office with suspicious ease (oh wow they have a close working relationship, what a suprise).
"I was at home with my family, you are interrupting."
Huge red line you don't cross here.
"I was at home with my family, you are interrupting."
Huge red line you don't cross here.
(This is where being able to play stupid American is so extremely valuable. You can just bulldoze through cues like this like they don't matter.)
I hand him my phone, and tell him to transfer the title please.
I hand him my phone, and tell him to transfer the title please.
After some tic-tac-toe and some grumbling in Arabic (I know enough Arabic to know that you told me to fuck my mom, asshole), I get an SMS.
The car is mine.
The car is mine.
Woo. All Rasheed now has to do is pay me back in 84 equal monthly payments starting whenever he get back to the country, with interest governed by LIBOR.
"Sir the decimal place is wrong."
"Nope. Eid Mubarak"
"Nope. Eid Mubarak"
A couple of hours ago though, I started getting a flurry of calls. It turns out that I had paid my bill with an American credit card, and that the car finance company had paid 4.5% in interchange fees instead of 0.25% they would have paid on a local credit card.
What a pity, what a pity.
Anyhow, I can wholly recommend the Chase Sapphire Reserve for sticking it to unscrupulous car dealers.
