If You Live In 1 of These Cities, You Probably Spent Way Too Much Money on Your Car

If you believe everything a car salesman says, you’ll end up spending way more on a vehicle than you should. Whether you upgrade to a fancier model, extend the life of a loan, or accept a high-interest rate, a bad vehicle purchase could haunt you (and your credit) for years.

According to a February 2018 report by WalletHub, the situation is dire in many cities — especially in the South and Southwest. In some places, it’s normal for buyers to take on debt that equals more than half a year’s income.

The experts that WalletHub consulted for this report offered a number of tips for avoiding this situation. Among them were:

  • Rejecting an emotional approach (i.e., the Fast and Furious method) to car-buying
  • Knowing your credit and loan options beforehand
  • Factoring in costs like gas, maintenance, and parking

Clearly, some folks — many living in the heart of Car Country, U.S.A. — are looking for the coolest ride in town and forgetting this common-sense advice. Here are the 15 U.S. cities where people pay way too much for their cars.

15. Brownsville, TX

A birds eye view of the expressway in Harlingen, Tx

The median auto loan debt in Brownsville is about $19,000. | iStock.com/DavieJones13

The border town of Brownsville lies about 200 miles south of Laredo. Both cities have a low median income and a large amount of auto loan debt, but only Brownsville made the top 15.

Overall, WalletHub found $19,110 in median auto debt compared to the $28,397 median salary in Brownsville, placing the city in the 99th percentile.

Next: This Georgia town is in way over its head when it comes to car loans.

14. Moultrie, GA

New Ford vehicles stand ready for buyers at the Sunrise Ford dealership

This Georgia town has a big problem with auto loan debt | David McNew/Getty Images

While Moultrie may not be a major city like Brownsville, the landlocked Georgia town has major-league auto debt. Compared to Moultrie’s $26,296 median salary, a typical car loan has an outstanding balance of $17,821.

Whether you calculate the ratio of debt to annual salary (68%) or just glance at the numbers, you can see it’s bad news. WalletHub experts say car buyers should only spend 10-15% of their annual income on a ride.

Next: This Florida lake town is underwater on its car loans.

13. Okeechobee, FL

Freddy Melayes shows a new Saab to Karen Cossio at the Deel Saab dealership

Okeechobee is one of many Florida towns where people are struggling with auto loan debt. | Joe Raedle/Getty Images

Some 40 miles west of Port St. Lucie, you’ll find the town Okeechobee, home to one of the biggest freshwater lakes in the U.S. You’ll also find one of the many Florida towns struggling with car debt.

Okeechobee’s median income ($27,382) is no match for the typical outstanding auto loan ($18,608).

Next: Areas around Dallas feature unusually large amounts of car loan debt.

12. Corsicana, TX

salesman talking with couple to sell a car

The median auto loan balance in Corsicana, Texas, is nearly $22,000. | iStock.com/Zero Creatives

Among America’s largest 20 cities, El Paso featured the worst loan-to-income ratio, with a rank in the 93rd percentile. A little further down the list (81st percentile) came the cities of Dallas and Houston.

Corsicana, located 60 miles south of Dallas, had America’s 12th-worst ratio of auto loans ($21,875) to income ($31,995).

Next: It would take nearly 70% of the median income to pay off auto debt in this Louisiana town.

11. Leesville, LA

New Lexus vehicles sit on the lot

The median income in Leesville is under $30,000. | Scott Olson/Getty Images

As you read through the WalletHub data, you’ll notice large car loans in Southern towns with low median incomes. In Leesville, Louisiana ($29,892 median income), the median car loan has over $20,000 outstanding.

Compared to a place like Scranton, Pennsylvania ($36,554 median income), you’ll see much less auto debt ($11,000). In fact, you’ll hardly find a town in the Northeast above the 80th percentile — even where the income is low.

Next: Another Texas border town makes the list.

10. Mercedes, TX

Mercedes-Benz W204 C-class is parked at the countryside.

With a median income of $26,834, few people in Mercedes, Texas, can afford a Mercedes. | iStock.com/ DarthArt

Another Texas border town, another area with huge car debt. This time, the town of Mercedes has nowhere the median income ($26,834) to keep up with the median vehicle loan ($18,559).

In total, such a car loan would swallow about 70% of a typical annual salary in Mercedes. With any sort of down payment, the total car price would be getting close to a full year’s income.

Next: A California city famous for the nearby music festival cracked the top 10.

9. Coachella, CA

Riverside County within the Coachella Valle

Coachella, which is east of Palm Springs (pictured above), doesn’t have much in the way of public transit. | iStock.com/miroslav_1

You may know Coachella for the annual music festival of the same name, but that takes place in nearby Indio, California. (Both towns reside in the Coachella Valley east of Palm Springs.)

Like every other place on this list, Coachella is a drive-or-you’ll-never-get-there kind of town. (Public transportation is hardly an option.) According to the WalletHub stats, the town median income ($26,506) can’t begin to handle its median auto debt ($18,782).

Next: This town in northern Louisiana is losing population and drowning in debt.

8. Bastrop, LA

New cars for sale sit in a lot at a local Chrysler dealership

The median auto loan debt in Bastrop is $15,832. | Roberto Schmidt/AFP/Getty Images

The small town of Bastrop, Louisiana is about halfway between Shreveport and Jackson, Mississippi. Following the closing of Bastrop’s paper mill and poultry plant during the Great Recession, the city began rapidly shrinking.

In the latest survey, the town’s median income ($22,304) was nowhere enough to cover its median auto loan ($15,832).

Next: Southern Texas notches another city on this list.

7. Kingsville, TX

Ford SUV's sit on a Ford dealership

The median car loan debt in Kingsville is close to 75% of the city’s median income. | Bill Pugliano/Getty Images

If you want to see a scary auto debt-to-income ratio, check out that of Kingsville, Texas. This town, which sits about 45 miles southwest of Corpus Christi, showed its median debt ($23,647) near 75% of the town’s median income ($32,379).

Since that salary is the highest on this list, you have to pin much of the blame on the car buyers. Clearly, the “emotions” factor get the best of too many consumers in Kingsville.

Next: Yet another border town claimed sixth place.

6. Donna, TX

used car sign

In Donna, Texas, some people might be better off buying a used car.  | Saul Loeb/AFP/Getty Images

The town of Donna sits 10 miles to the west of Mercedes (No. 10) and 50 miles west of Brownsville (No. 15) near the Texas-Mexico border. Clearly, car culture in this part of the country deems a ride more important than financial security.

Donna’s median income ($27,891) suggests used vehicles should be the sensible choice for most consumers here.

Next: Northeast of Atlanta, a low-income town had nearly an 80% debt-to-income ratio.

5. Dahlonega, GA

Phonak Hearing System team drives the peloton

A bike race passes through Dahlonega, Georgia. Some residents might want to consider trading four wheels for two to avoid crushing auto loan debt. | Doug Pensinger/Getty Images

Only one city on this list had a lower median income ($21,883) than Dahlonega, Georgia. This town, situated 65 miles northeast of Atlanta, showed over $17,000 in debt for the median car loan. In other words, it would take about 80% of someone’s median salary to pay off the median loan.

Next: The situation north of Houston is even worse.

4. Magnolia, TX

Jeeps built by Chrysler sit on the lot at a dealership

In Magnolia, the median car loan debt nearly matches the median income. | Scott Olson/Getty Images

The tiny town of Magnolia sits about 45 miles northwest of Houston and has an even worse record for car debt. Matched against a median income of $27,000, the median car loan of $21,000 just won’t get paid on time.

Next: The repo man is busy in this border town.

3. Rio Grande City, TX

Dealer New Cars Stock. Colorful Brand New Compact Vehicles

One in three Americans owes money on their car. | iStock.com/ welcomia

As of 2017, Americans had over $1 trillion in car loans spread across 107 million people. You read that right: One in three Americans owes money to a bank for their vehicle.

In places like Rio Grande City, right smack on the border with Mexico, repossessions are a common occurrence. While residents post a median income of $31,500, the typical car loan stands at $25,200.

Next: The situation in nearby San Juan was even worse.

2. San Juan, TX

Sale signs lie on vehicles at a General Motors Chevrolet dealership

San Juan is another South Texas town with a big auto debt problem. | Bill Pugliano/Getty Images

South Texas is clearly the worst area in America when it comes to owing more on a car than people can afford. This time, the town of San Juan — the third on this small stretch of Interstate 2 — claimed over 80% of the median salary owed for a vehicle.

Next: This Florida town claims the highest rate of car debt in the country.

1. Lake Placid, FL

Used Ford vehicles sit at a Ford dealership

The median auto loan debt in Lake Placid is nearly 90% of the median salary. | Bill Pugliano/Getty Images

If you travel through central Florida, you’ll find the small town of Lake Placid in Highland County, not far from Lake Okeechobee. This area rivals southern Texas for out-of-control spending on cars.

It won’t take a mathematician to see that a median salary of $19,153 can’t begin to manage a median auto loan of $17,023. That’s nearly 90% of a year’s wages and the definition of unsustainable.

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