“Why did you get two Hondas at $1,000 each a month, man? Plus insurance?” It’s a serious question bothering the car dealer. If you follow Yusuf Benallal, you can almost feel his headache creeping on.

The salesman, consultant, and CEO operates out of Auto Cafe in North Miami Beach, Florida. And at this point, while he’s all about trying to help drivers get out of bad car loans, his exasperation at the breadth of poor financial decisions his clients make, over and over, seethes through in his TikToks.

Here’s a great example of a Honda driver, who’s also a husband and dad, trying to get out of two spendy car loans he agreed to in a moment of desperation.

This 2022 Honda Civic Sport and 2018 Honda CR-V cost a New York family way, way too much

The Civic is $862 a month. The CR-V’s payment is $999. That doesn’t include insurance, fuel, or maintenance.

The insurance costs the couple about $500 a month. Both loans include interest rates crossing 24%.

“Now, that’s killing me,” the caller tells Benallal.

The driver explains that he uses the Civic to get work, which requires travel. The CR-V is their family hauler, since he and his wife have a child.

Today, his goal in calling Benallal is to trade one or both Hondas. He’d like to land a newer CR-V under $1,000 a month.

But the car dealer’s already looking at the ceiling in defeat at the proposal.

The caller claims that before buying the used Honda cars, he and his wife drove “hoopties”

The driver says their junkers kept breaking down and, in his words, cost him getting to work. “We literally had no cars, no way to get to work…and I only had $1,000 in my account.”

He says he walked into a car dealership with that $1,000 cash.

This is when the car dealer calmly listens, and actually feels for the caller. “I hear you,” Benallal empathizes. “But look…hindshight right now…this wasn’t the smartest move.”

Spending toward a dream, but buying into a trap

The thing is, when drivers get desperate for a car, whether it’s “newer,” “higher performance,” “more luxurious,” and only have a small amount of cash down and subprime credit, you’re buying into a trap.

Many buyers don’t realize that large car payments with a  high interest rate doesn’t mean you’re immediately paying down your loan balance. In fact, you’re hardly putting a tiny dent in.

When some realize they can’t actually survive with a $1,000 car note, it’s often too late to reverse the damage.

See, the car quickly depreciates, or was worth less than the loan terms in the first place. In other words, the drivers might owe thousands more than what the car’s actually worth, making offloading the vehicle financially impossible.

Once the trade-in value is calculated, most drivers don’t have the cash to pay off the remaining loan balance. Plus, they’d need even more cash to purchase their next car.

Downright delusional…but is it entrapment?

So when Benallal hears from an underwater buyer that they want an even nicer, newer, more expensive car for less than what they’re currently paying…well, it just looks downright delusional from an expert’s view.

And who’s to blame for this systematic entrapment? Some say car salesmen are…but in the good ole’ U.S. of A., the consumer is responsible for understanding what they’re buying.

Used Honda trade in values

In terms of this caller’s situation, his Honda Civic is worth about $18,500 to $20,000. Unfortunately, that means he’s about $9,000 underwater on it.

The 2018 Honda CR-V is only worth $20k, while he owes $31,000. “You’re $11,000 underneath,” the car dealer tells the New Yorker.

Combined, the couple is about $20,000 underwater on their car loans.

The caller says he only has about $2,000 cash to put toward that balance and a down payment on a new loan.

In the end, the car dealer explains that the Honda driver’s financial picture (including a 580 credit score) just isn’t a good recipe for getting out of these loans.

Benallal recommends either sticking with the loans until he’s out of the red on them, refinancing, or even renting one on Turo to help pay the notes.