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High-Tech RepoMan

samzenpus posted more than 8 years ago | from the I'm-sorry-dave-I'm-afraid-I-can't-let-you-drive dept.

Technology 452

PlayfullyClever writes "A new gizmo is upping the odds that even the most hard-knock customer will come up with the car payment. Hooked into the ignition system, the gadget comes in a handful of versions with one common conclusion: No pay, no start. It's worked wonders at Norfolk's Patriot Auto Sales, where nearly every car that drives off the lot is outfitted with a PayTeck Smart Box, a system that hands over a five-digit code in exchange for each payment. Come due date, the car won't crank until the customer punches the code into a palm-size keypad wired into the dash. I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money."

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fp botches! (-1, Offtopic)

kennedy (18142) | more than 8 years ago | (#14153029)

oh yes.

frost post (-1, Troll)

Anonymous Coward | more than 8 years ago | (#14153030)

for the north pole

What the hell (1, Insightful)

Psionicist (561330) | more than 8 years ago | (#14153035)

And people accept this? I though the day someone introduced DRM on physical products people think they understand (unlike computers) would be the day the publik spoke out against this nonsense. If people accept "car DRM" then I guess they will accept all sorts of computer based DRM too. This is sad news.

Re:What the hell (5, Interesting)

the_humeister (922869) | more than 8 years ago | (#14153048)

Well, at least people with bad credit histories will be given the chance of buying to buy a car. It won't matter for those who have the money, but it just might be good for those who are poor.

Re:What the hell (5, Insightful)

Shakrai (717556) | more than 8 years ago | (#14153104)

Well, at least people with bad credit histories will be given the chance of buying to buy a car. It won't matter for those who have the money, but it just might be good for those who are poor.

Actually, it's still extortion plain and simple. There is a local "buy here, pay here" car dealer that has been using these devices for quite awhile. You would think that in exchange for getting put a device on a car that you own that they would give the people with shitty credit history a break on the interest payments. After all, isn't the theory behind charging people with lousy credit higher interest that you need to do so in order to recoup losses? Not as much room for losses with this system.

Of course it doesn't work out that way in practice. They still charge anywhere from 15%-25% on a car loan. It's legalized loan sharking that takes advantage of the most desperate among us.

I'd also point out that even if you need a loan to buy a car you still own that car outright. The only thing that the bank/financing company has in the car is a security interest. This is not the same as them owning a percentage of the car. So why the hell should they be allowed to require this?

I would encourage everybody out there to avoid the whole problem by not buying a car that you need a loan on. I have never spent more then $2,000 on a car. Sure, I spend some money in repairs -- but the year end figure doesn't come close to most car loans (which still need repairs). And driving cheap ghetto cars allows me to avoid having to pay for expensive collision coverage.

Failing that, if you must have a nice car and can't afford to buy it outright, then get the loan for your car from your credit union or local community bank. Why the hell should we be doing the auto financing companies any favors?

Re:What the hell (4, Interesting)

bofkentucky (555107) | more than 8 years ago | (#14153134)

You don't own it, the lot owns it, you're making payments and they are allowing you to drive the car. Once you pay off the loan its yours to do with as you wish, but if you fall behind on the payments, its their right to seize their property.

Re:What the hell (5, Interesting)

Shakrai (717556) | more than 8 years ago | (#14153177)

You don't own it, the lot owns it, you're making payments and they are allowing you to drive the car. Once you pay off the loan its yours to do with as you wish, but if you fall behind on the payments, its their right to seize their property.

I'm sorry, but in virtually every sane auto contract that is not so.

If I buy a car from a dealership then I am going to get a bill of sale. I will eventually get a title from DMV that shows that I own that car. The title will also reflect the security interest of whomever gave the loan for that car (assuming I didn't buy it outright) -- but the fact remains that I own the car.

A security interest is not the same as them owning the car. The lot got paid for the car by whomever I got the loan from. It's the same theory behind a secured credit card (another typical ploy used to screw people -- WTF does a secured credit card with no risk to the issuer require massive fees and 20% interest??). The bank doesn't own the funds you deposited into the account to get the card -- they only have a security interest in them.

Now I can't speak for the contracts that you sign if you buy a car from a carshark "buy here, pay here" type guy. I'm not stupid or desperate enough to do business with one.

Re:What the hell (2, Informative)

bofkentucky (555107) | more than 8 years ago | (#14153222)

But that's what this lot is, lot financed cheap transportation. Even still, if you don't own a car outright, even from a reputable dealer, that title has a lien set against it that is callable if you ever violate your payment contract, even if the loan is with a company not related to the dealer (ie your bank/credit union).

Re:What the hell (2, Insightful)

Shakrai (717556) | more than 8 years ago | (#14153274)

Even still, if you don't own a car outright, even from a reputable dealer, that title has a lien set against it that is callable if you ever violate your payment contract, even if the loan is with a company not related to the dealer (ie your bank/credit union).

But that lien doesn't mean that they own the property. It only means that they have an interest in the property and it may serve to restrict your rights regarding the transfer of that property. It doesn't restrict any other rights that you may have.

If it did, then buying a house would be just like renting it until you paid off your mortgage. Why should the bank let you pound holes the wall to hang pictures and paint the walls any color but white? Most landlords won't in a renting scenario. The answer is that the bank doesn't own your house -- they only have a security interest in it.

Re:What the hell (4, Informative)

bofkentucky (555107) | more than 8 years ago | (#14153314)

That lien is callable the momment you default on the terms of the contract, its not a matter of them sending a real repo man out then it becomes callable. This device secures their interest in the property, well within their rights.

Re:What the hell (1)

Scuff (59882) | more than 8 years ago | (#14153262)

yes, you will eventually get the title for the car. After you pay off the loan until then, the bank or whoever the lienholder is will have the title.

Re:What the hell (2, Informative)

Anonymous Coward | more than 8 years ago | (#14153199)

I don't know how things work where you are, but in Australia, when you buy a car, you own the car.

When you get finance from the car yard, you're actually getting it from a financial institution that the yard has an agreement with. They give the car yard the money, you get the car, and you pay the financial institution, not the car yard.

When I pick up the car, I take the ownership papers down to the government shopfront, pay the stamp duty and get the ownership transferred into my name. Nowhere does the car yard's name, or the finance company's name appear on the new ownership papers. It's my car.

It only becomes the finance company's car if I default on the loan, as it is security towards that loan. The only other place I have to mention the finance company is on my insurance policy - presumably so that if its written off, my insurance company will just pay the finance company the balance directly.

Re:What the hell (1)

bofkentucky (555107) | more than 8 years ago | (#14153241)

Not familiar with austrialian law, but in the US, the title to a car (or land deeds) has liens against said property listed on the title. Those liens are callable if you default, and since most car/land loans are secured with the property in question, it's the bank/dealer's right to seize their property if you are in default.

What the hell-"/." lawyers. (0)

Anonymous Coward | more than 8 years ago | (#14153189)

"Actually, it's still extortion plain and simple. There is a local "buy here, pay here" car dealer that has been using these devices for quite awhile. You would think that in exchange for getting put a device on a car that you own that they would give the people with shitty credit history a break on the interest payments."

You OWN the car when you've made all the payments. And no it's NOT extortion, because you can always take your business elsewere.

"I'd also point out that even if you need a loan to buy a car you still own that car outright."

You can point till the cows come home. Legally your still wrong.

"Failing that, if you must have a nice car and can't afford to buy it outright, then get the loan for your car from your credit union or local community bank. Why the hell should we be doing the auto financing companies any favors?"

Maybe...because neither institute wants to take the risk. A community bank, or a credit union isn't going to stick their necks out for a known risk.

Re:What the hell-"/." lawyers. (3, Insightful)

Shakrai (717556) | more than 8 years ago | (#14153232)

You can point till the cows come home. Legally your still wrong.

Umm, bullshit. Do you not know what a Lien [wikipedia.org] is? To quote: "In U.S. law, lien is the broadest term for any sort of charge or encumbrance against an item of property that secures the payment of a debt or performance of some other obligation."

A lien tells somebody who might be looking to buy your property that somebody else has a security interest in it. This does not mean that you don't own the property. It will probably prevent you from transferring ownership of that property until that lien is satisfied but it does not change the fact that you own that property yourself.

In fact, even if the property is transferred the lien will usually survive and the new owner has to deal with it. A good example would be a house that was seized by the government for taxes that still had a mortgage against it. If you buy that house at government auction you are going to have to come to terms with the bank that holds the lien against it.

Re:What the hell-"/." lawyers. (0)

Anonymous Coward | more than 8 years ago | (#14153272)

Um... smart guy, if you're going to quote something, try something that actually talks about what you're discussing! Your lien quote from wikipedia doesn't say anything about the ownership of the item, which makes me more skeptical about you opinion which follows.

Re:What the hell-"/." lawyers. (2, Informative)

Shakrai (717556) | more than 8 years ago | (#14153323)

It's a little hard to find but I did find this [state.ny.us] on the NYSDMV page.

To quote: "Before you accept the title certificate from the seller, check the front of the title for the names and addresses of lien holders. A lien indicates the current owner owes money on a loan for the vehicle. If a lien is listed on the title, ask the seller to give you the proof the lien has been paid - in most cases, it will be an official lien release from the lender. If proof is not provided, the lien holder could repossess the vehicle from you."

You'll note they use the term "current owner". A lien simply records the fact that somebody might have a security interest in the property. It does not mean they own it. It gives them a legal means of seizing that property if any obligations are not met -- but until they seize it they do not own it.

I'm kind of surprised by the number of people sticking up for these assholes. Why is this any different from RIAA treating their customers like criminals? I sign a contract with my bank to borrow money with a promise to pay that money back. Why the hell should they get to assume that I won't and require me to modify my property?

Will mortgage companies require that you use a keypad locking system on your house that keeps you from leaving/entering if you fall behind on your payments? It also seems rather stupid to disable the car if they miss one payment. Yeah, I'm sure somebody that falls on hard times and misses a payment will find it real easy to make money to catch up on payments when they don't have transportation.

Re:What the hell-"/." lawyers. (1)

mabinogi (74033) | more than 8 years ago | (#14153238)

> You can point till the cows come home. Legally your still wrong.
Prove it, with references - and indicate the jurisdiction you're talking about, so that we can all make sure we live somewhere more sane.

Unless you're dealing with a really dodgy car yard, the car is yours as soon as you've got the appropriate paperwork signed and lodged with the government. What happens with the money has very little to do with it.

Re:What the hell (2, Informative)

Anonymous Coward | more than 8 years ago | (#14153217)

> You would think that in exchange for getting put a device on a car that you own...

Once you pay for it.

> I'd also point out that even if you need a loan to buy a car you still own that car outright.

Once you pay for it.

> So why the hell should they be allowed to require this?

Because they just let you drive off with a $3000 car after forking over $250.

> I would encourage everybody out there to avoid the whole problem by not buying a car that you need a loan on.

I would encourage everybody out there selling cars to tell people like you to enjoy riding the bus.

> I have never spent more then $2,000 on a car.

Glad to hear it. I hope you enjoyed following Phish around and selling tofu veggie poop nuggets to other unwashed trust-fund hippies.

> And driving cheap ghetto cars allows me to avoid having to pay for expensive collision coverage.

On behalf of those of us who have to pay inflated insurance rates to cover your accidents, eat cock and die.

> Failing that, if you must have a nice car and can't afford to buy it outright, then get the loan for your car from your credit union or local community bank.

Ooh! A local community bank! It's the next best thing to open-source money! Fight the power! Che lives! Play "You Enjoy Myself," you faggots!

> Why the hell should we be doing the auto financing companies any favors?

You shouldn't! Stick it to them! Be mad as hell and don't take it any more! It's not like they're doing anything for *you*, man! FREE HUEY!!

Re:What the hell (1)

Shakrai (717556) | more than 8 years ago | (#14153256)

On behalf of those of us who have to pay inflated insurance rates to cover your accidents, eat cock and die.

I'm sure your just trolling and you are dead wrong about the ownership issue, but I'd like to hear you explain to me exactly why the fact that I don't carry collision on my car would inflate your insurance rates.

Collision covers damage to my car if I'm in an accident that was my fault. If I'm in an accident with you and it's my fault then my insurance company is going to pay for the damages to your car regardless of the status of my collision coverage. That payment will come out of my property damage limit. It has nothing to do with collision.

Likewise, if you hit me and you are at fault, then I'm going to get money to pay for the damage to my car regardless of whether or not I have collision.

I don't even know why I'm bothering. I'm sure your a troll.

Re:What the hell (2, Informative)

CastrTroy (595695) | more than 8 years ago | (#14153327)

This really depends on where you live. In Ontario Canada, there's no fault insurance. Which, basically says, that you buy insurance to cover your own car. It doesn't matter whether who's fault the accident was, or whether is not your car was parked when the accident happened. You pay for your own coverage. If you think you want coverage in case of a collision, then you pay for it yourself, and when something happens, you go to your insurance company, and they pay you the money. It doesn't matter if your car was parked, and someone drives over it with a humvee. If you don't pay for insurance to cover it, insurance companies aren't going to pay for it.

Re:What the hell (1)

adamdeprince (600460) | more than 8 years ago | (#14153304)

>> And driving cheap ghetto cars allows me to avoid having to pay for expensive collision coverage. >On behalf of those of us who have to pay inflated insurance rates to cover your accidents, eat cock and die. Now calm down. Collision is the part of your policy that covers *your* car when *you* drop a hot tofu veggie poop nugget in your lap. Look at your policy ... it is broken down by category, and for each you can pick and choose. All you must do is maintain the minimum coverage requirements of your state ... those states with mandatory coverage only care that you have coverage for the people you run over when reaching to the floor to pick up your nugget. Whether your unwashed hippie friend has collision only affects if he gets paid by his company for the damage to his car times his proportion of fault. There is no great Ayn Rand objectiveist "see I told you what happens when you don't vote libertarian" miscarriage of common sense occuring here. Move along now.

Re:What the hell (1)

Meor (711208) | more than 8 years ago | (#14153286)

Your logic is flawed. You do not own the car if you have a loan on it, you "own" it on lein, the bank hold the title, that's why they can take it if you don't pay. Everything you say is based on this false assumption that it's your car, which it's not.

Re:What the hell (0)

Anonymous Coward | more than 8 years ago | (#14153049)

I think it says more about the people that there is a need for this.

Re:What the hell (4, Informative)

jumpingfred (244629) | more than 8 years ago | (#14153051)

If you read the article you would find out that the only people who would accept this are people who can't get anyone to loan them money for a car that works.

Did you RTFA? (1)

mekkab (133181) | more than 8 years ago | (#14153064)

This is "collateral" for people with BAD credit; either you play their game or you don't get a car.

Think about why you have credit so bad that the only way you can get a car is with one of these boxes.

Re:What the hell (1)

jbman64 (920243) | more than 8 years ago | (#14153066)

How is this DRM? The dealer is not telling you where you can drive and how fast. All this system does is prevent you from driving "your" car until you pay for it. Owning and driving a car is not a right.

Re:What the hell (1)

TheGavster (774657) | more than 8 years ago | (#14153158)

This is exactly the same as DRM on software. If you fail to pay the license fee on annually licensed software, the DRM kicks in and it fails to start.

Re:What the hell (1)

know1 (854868) | more than 8 years ago | (#14153077)

how the hell is this drm? what, are you wanting to burn the car to cd or copy it to your ipod or what? it's nothing like drm and is completely acceptable in a hire purchase agreement. if i don't pay my internet bill, they turn it off, i no longer "hire" the line from them. bad analogy but you get the idea

Re:What the hell (0)

Anonymous Coward | more than 8 years ago | (#14153107)

Digital rights management - the computer (digitally) controlled limitation on your rights to a particular item or commodity.

Re:What the hell (0)

Anonymous Coward | more than 8 years ago | (#14153082)

If you don't pay your cell phone bill your service will be shut off. Why not the same for a car?

Mod DUMBASS PARENT DOWN (0)

Anonymous Coward | more than 8 years ago | (#14153097)

See subject.

Re:What the hell (1)

sumdumass (711423) | more than 8 years ago | (#14153185)

This isn't exacxtly the mass DRM you were thinking about. It would only effect the poor/poorer people who don't have any other options.

This is kind of like why they rais taxes on beer and cigarettes. It only pisses off a quarter of the population and usualy the same quarter that doesn't make a big impact. Even if these people are upset and voice an opinion about it, everyone else still looks the other way and thinks as long as it doesn't effect them. Soon poor people or people with hardshipsor (whatever caused the bad credit) in thier life will be joining the antiDRM crowd. The other people will say "but the car dealership/music artists need to get paid to0." and as long as it doesn't take anyhting away from them, it's al good "because you shouldn't be stealing in the first place".

--Now i'm off. The solid gold bar and barstools just arrive and I have to make sure they place it in the right spot next to my olympic sized swiming pool.

Re:What the hell (1)

Nivoset (607957) | more than 8 years ago | (#14153289)

ive seen this before, about 4 years ago. it was only used on people who's credit is sooo bad, they cant trust them otherwise. it works for 2 reason really. it makes sure the company gets the money, and it gives someone with that bad of credit the ability to get a car and go places. something almost needed for anything in life now a days.

Re:What the hell (1)

Blakey Rat (99501) | more than 8 years ago | (#14153302)

If you don't like it, don't buy a car from a dealership that uses it. It's that simple.

However, if you don't like it, *and* your credit is so bad that nobody else will give you a loan, you might have to become familiar with the bus routes... guess you should have paid more attention in high school civics class when they were talking about your credit rating!

I wouldn't buy a car with this system (1)

Firethorn (177587) | more than 8 years ago | (#14153037)

Like requiring a breathalyzer on board each car, or a GPS system, this assumes too much in the way of wrongdoing on my part for me to like it.

Of course, with my good credit and automatic payments, I'm not likely to get behind on payments, such that the system might cost more than it's worth. I hope the keypad can be used for other things as well.

For somebody with shady credit, though, it might be an option, though like what was stated, it'd probably be pretty easy to bypass if you know what you're doing.

You would buy it (2, Insightful)

Filthysock (557067) | more than 8 years ago | (#14153046)

If the company using it saved money overall and could give you a better price than the competition.

Re:You would buy it (1)

Firethorn (177587) | more than 8 years ago | (#14153053)

It'd better be better than $20 a payment in savings to make it worth it for me.

Re:I wouldn't buy a car with this system (0, Flamebait)

alienw (585907) | more than 8 years ago | (#14153086)

Uh, dude, this system is for white trash with such awful credit that they can't even get a loan from a loan shark car place. This is usually the people with multiple repossessions and bad debts. I don't think anyone who is not white trash needs to worry about this system.

I also don't think anyone will be bypassing it -- it's mainly there because it's cheaper than repoing the car, and people who buy cars from those places aren't smart enough to disable it (and probably can't afford to pay someone to do it for them).

Re:I wouldn't buy a car with this system (2, Insightful)

spauldo (118058) | more than 8 years ago | (#14153157)

Actually, quite a lot of the people who have bad credit _know_ how to bypass this sort of thing.

You don't ask rich people to help you fix your car. Rich people who can fix cars are called "mechanics" and "shop owners", and won't help you for a twelve pack. Poor people fix their own cars, or junk 'em and buy another one for $300.

Now, bad with credit != poor, but bad with credit != stupid, either. And poor != stupid as well. But most people I know who are handy with a wrench fall below the poverty line.

Well if you have good credit, you won't (2)

Sycraft-fu (314770) | more than 8 years ago | (#14153330)

This is only targeted at those with poor credit. For one thing you are right, that for people with good credit it's an unnecessary cost (good credit means, by definition, a person that generally repays debts on time and in full). However the bigger reason is that this pisses people off and if you have good credit, you have options. If a dealership wanted to do this you could simply go to your bank, get a loan form them with the car as colleratal and go buy the car straight cash from the dealer, in which case they'd have no right to install such a system.

It's an idea similar to a secured credit card. Most people have unsecured cards, meaning that the bank is wiling to loan you an amount of money up to the limit of your card. They trust (or perhaps hope in some cases) that you will pay them back. However for people with really bad credit, or with no credit, they often aren't willing to do this. After all, if you walk on them, they are screwed. So what you can do is get a secured card. You put a certian amount of money in an account, as much as you like. You then get a card with a limit of that amount. Should you fail to pay, they'll take the money in the account to pay it, nothing lost.

So same thing here, it's security for the lender that in the event they don't get paid, the car won't just run off to some other state or country and become hard to impossible to track down. True it can be bypassed, but that's not real likely.

Hmmm.... (4, Informative)

8127972 (73495) | more than 8 years ago | (#14153039)

"I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money."

From TFA:

"Buyers sign forms acknowledging the Smart Box, agreeing not to tamper with it and promising to return to the dealership for a free removal after the last payment is made."

That implies that screwing with it in any way will get you into trouble if you get caught. That's not to say that somebody won't try, but it also implies that they have a means of catching you.

Re:Hmmm.... (2, Interesting)

cowscows (103644) | more than 8 years ago | (#14153060)

Yeah, and even if they do hack it or whatever, what ends up happening? The same thing that happens with a normal car nowadays. If the Smart Box became standard on all cars tomorrow, all the old ways of tracking down vehicles and non-payers would still exist.

You can break through a window and unlock the front door of my house from the inside easily enough, but that doesn't mean that putting installing a deadbolt was a bad or worthless idea.

Re:Hmmm.... (1)

A Commentor (459578) | more than 8 years ago | (#14153074)

"I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money."

This is not the reason that you have to make the payment... if you don't the Repo-man will come and get it. This just makes it much less likely that the repo-man would have to be called.

Re:Hmmm.... (1)

Rick Zeman (15628) | more than 8 years ago | (#14153096)

"Buyers sign forms acknowledging the Smart Box, agreeing not to tamper with it and promising to return to the dealership for a free removal after the last payment is made."

Speaking of the legalese, I bet there's a whole bunch of weasel words saying they're not responsible for what happens if they don't get the code on time to the customer and Bad Things happen as a consequence. So what are the pro's to buying from this joint? Is this on of the 25% interest car places for people with bad credit (which makes sense if they're so concerned with repos)?

Re:Hmmm.... (1)

Rick Zeman (15628) | more than 8 years ago | (#14153125)

Next time I'll RTFA article before posting. D'oh!

Re:Hmmm.... (1)

maetenloch (181291) | more than 8 years ago | (#14153184)

"Buyers sign forms acknowledging the Smart Box, agreeing not to tamper with it and promising to return to the dealership for a free removal after the last payment is made."

I doubt that legal issues by themselves would deter anyone from trying to defeat the box. The main reason it will work is that the type of people who are desperate enough to accept this kind of restriction are usually not motivated enough, technically savvy enough, or even clever enough to be able to disable it. The intersection of smart hacker types and credit deadbeats is probably a pretty miniscule percentage of their customers. Of course if these devices do become popular, then there'll be a market for hackers with the skills to defeat them just like with cable black boxes or satellite cards.

There are several competing systems like this (5, Informative)

n76lima (455808) | more than 8 years ago | (#14153055)

My brother runs a car lot in Memphis and has been using a device like this for years.

Sure a saavy mechanic can find the ignition lock out and disable it, but its in the contract that people sign at purchase that they will not disturb it, and is a felony to tamper with it (at least in Tennessee).

He's had a few folks defeat it and stop making payments, but eventually something happens to get the car repo'd and the customer in hot water. He says he's lost a very tiny percentage of the hundreds of cars he's outfitted with the ignition lock out.

--
We don't NEED no stinkin' sig

Bad logic (2, Insightful)

katana (122232) | more than 8 years ago | (#14153062)

"I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money."

Not really. It just means that they would fall back on the existing system, that is, physical repossession. In other words, it's no worse than the current system (from their perspective), and might encourage the non-hackers (eg almost everyone) to pay up.

Slight improvement (2, Insightful)

Facekhan (445017) | more than 8 years ago | (#14153075)

This is probably less expensive than having to go out and repo cars for late payments which usually results in exorbitant (300-500 dollars) charges in order to get the car back in addition to making all the late payments. At least this way, you call up, do an electronic payment and you can get your car back right away without being extorted for repo fees.

Wow! (2, Funny)

Crouty (912387) | more than 8 years ago | (#14153076)

Cool, you don't just get the car but also a nice keypad that comes with it. * hotwiring rental as usual *

Repossession is not a joke (5, Insightful)

ReformedExCon (897248) | more than 8 years ago | (#14153081)

Repo men, whatever you think about their profession, risk their lives daily in order to prevent auto theft, which in a way is what failing to pay car payments is.

It isn't even like loan companies send out the repo man after your first failure to pay. You typically get several months of haggling and pleading before the loan company has no other alternative but to send someone out to repossess the automobile. And the repo man is frequently in danger from people who don't have enough money to pay the loan companies but usually enough to buy bullets.

Using a technical measure to disable cars, making them useless to the owner, is a great idea. It works with drunk drivers and car thieves. Just kill the engine and the car isn't going anywhere. The loan company can then repossess the car at their leisure, along with adding extra pressure on the defaulting "owner" to pay.

The real bottom line is not to over-extend your finances. Try to buy large items like cars with cash. The worst monetary investment you can make is to take out a loan to pay for a car you can't afford.

Wow. Welcome to Six Months Ago... (1)

tpconcannon (619066) | more than 8 years ago | (#14153083)

Nothing like old news to hit the front page. Again. And Again.

Re:Wow. Welcome to Six Months Ago... (0)

Anonymous Coward | more than 8 years ago | (#14153193)

Then stop fucking reading slashdot. yeesh!

Re:Wow. Welcome to Six Months Ago... (0)

Anonymous Coward | more than 8 years ago | (#14153221)

Repetiveness doesn't seem to keep you from slapping the ham though does it?

Smart Contracts (2, Insightful)

SiliconEntity (448450) | more than 8 years ago | (#14153088)

Security-expert-turned-law-prof Nick Szabo [vwh.net] predicted this kind of thing many years ago. He called it a Smart Contract [vwh.net] . The idea was to use technology to make contracts self-enforcing. Like many of Nick's ideas, he was and is way ahead of his time. These kinds of things are inevitable.

Re:Smart Contracts (1)

weston (16146) | more than 8 years ago | (#14153250)

The idea was to use technology to make contracts self-enforcing. Like many of Nick's ideas, he was and is way ahead of his time. These kinds of things are inevitable.

I hope not.

If I read Lessig correctly, the problem with this is now people can enforce via mechanism provisions that the law might not allow them to enforce.

There's a reason security systems are generally not allowed to injure intruders. There's a reason we get upset at the DMCA essentially killing fair use.

Problem (2, Interesting)

Lord_Dweomer (648696) | more than 8 years ago | (#14153092)

And what if the system malfunctions and you are unable to get to the hospital in time and someone dies?

Yeah, worst case scenario, but a liability nonetheless. The reason this system won't be accepted is because the current system is one based on trust and legal consequences. You purchase/lease the car with the expectation that it starts whenever you want it to. Even if there is a problem with the billing system of your credit card company or bank, or with the company who maintains the payment records for your car.

They are assuming some amount of risk by letting you make your payments over a period of time and in return they tend to get more money than if you paid it all up front. That is how the system has always worked, and thats how it will continue to work because not enough people will be stupid enough to lose their end of that bargain.

Re:Problem (1)

queef_latina (847562) | more than 8 years ago | (#14153154)

And what if the system malfunctions and you are unable to get to the hospital in time and someone dies?

We're talking about working class 'bad credit' people who probably can't afford medical care anyway, and on top of that most of them are criminals and drug addicts. *shrug*

Re:Problem (1)

SurfaceMount (749329) | more than 8 years ago | (#14153165)

And what if the system malfunctions and you are unable to get to the hospital in time and someone dies?

Car alarms with immobilisers often fail, I havnt heard of anyone being sued over that.

Re:Problem (2, Interesting)

Dun Malg (230075) | more than 8 years ago | (#14153186)

And what if the system malfunctions and you are unable to get to the hospital in time and someone dies? Yeah, worst case scenario, but a liability nonetheless.

No, more like "no liability". You think there's not something in the contract about this already? Besides, as long as it's not willful, vehicular malfunction that doesn't directly contribute to the death or injury is unlikely to result in liability regardless of contract. Would Motorola be liable for you not being able to dial 911 on your cell because the '9' button was faulty? Would Abercrombie and Fitch be liable if your A&F belt failed, causing your pants to fall down, making you trip and drop your only phone in the fish tank, thus preventing you from summoning an ambulance? It's just such craptacular ignorance of the basic workings of law that makes our jury system so fail so spectacularly, particularly in civil cases.

Re:Problem (1)

qzulla (600807) | more than 8 years ago | (#14153320)

Would Motorola be liable for you not being able to dial 911 on your cell because the '9' button was faulty?

They might be if they disabled the '9' button.

qz

Re:Problem (2, Informative)

heli0 (659560) | more than 8 years ago | (#14153194)

"The reason this system won't be accepted..."

http://www.ppsontime.com/news/inc3.gif [ppsontime.com]

Seems this became a common practice long ago.

Re:Problem (1)

bofkentucky (555107) | more than 8 years ago | (#14153196)

Since when did you have the right to commandeer a car you don't own for your personal transportation? A good samaritan may give you a lift if they so choose, but they don't have to.

Re:Problem (1)

maxume (22995) | more than 8 years ago | (#14153211)

I get the feeling that dealers/carmakers/etc aren't held liable when a car, under warranty or not, fails and causes a problem getting to the hospital. This is a good thing. They aren't selling a *Wonder Transport 5000* *Guaranteed not to fail*. They are a selling a *car*. They break sometimes.

Also, from what a poster above said, it sounds like this system works great. People with decent credit will avoid it as they will be able to find a dealer willing to sell them a car without the system, but dealers that sell to people with poor credit will use it in the simple case that it makes them slightly more money than not using it. The people with poor credit can either use it or go without a car...

Re:Problem (0)

Anonymous Coward | more than 8 years ago | (#14153237)

Actually, I've seen the answer to this a year or more ago on the news. Most of these systems have a "one time activation code" so that in an emergency the vehicle can be used, but only once!

Buy Here, Pay Here places suck. (1, Redundant)

RoadWarriorX (522317) | more than 8 years ago | (#14153094)

I think these guys are the biggest crooks. I almost brought a junker from one of these places way back in 1990, when I did not have a lot of money. They charge 15+% interest! They take advantage of the poorest, underpriviledged people who need cars, but have bad or no credit (I had no credit). No wonder no one wants to pay. I'll never recommend them and try to convince people to use public transportation whenever possible. At least in the long run, they would be able to save a little money and build credit. That's what I did.

I dont think so... (2, Insightful)

doctorjay (860762) | more than 8 years ago | (#14153098)

Most of the people who are not making payments are poor people who cant afford to do so or con artists looking for a free ride (pun intended), not automotive electrical engineers who can bypass the elecronic ignition cutoff that this thing must be hooked to.

Could the experienced person tinker with this and get away with the car? Perhaps. I think its a good system. Its meant to be more of a pain in the ass than anything. I know of some dealers who install GPS signals into the cars they sell to their "good credit-bad-credit-no-credit-come-one-come-all" customers. No pay, they repo the car. The reciever is hidden in some crazy place like behind the dash so the customer will never find it.

Also remember that if the do go delinquent on their payments, and the dealer files the car as stolen... they are then commiting .. ah yes, gamers you know the words, say them wtih me...
GRAND THEFT AUTO.

Re:I dont think so... (1)

doctorjay (860762) | more than 8 years ago | (#14153126)

sorry long day I know dealers cant install gps signals into cars... so before the nazis come out ..

Re:I dont think so... (1)

spauldo (118058) | more than 8 years ago | (#14153224)

Car wiring is not rocket science. The only way offhand I can think of to make this too difficult for the average shadetree mechanic (which, people who can't afford car care quickly become or make friends with) is if it was wired into the ignition control module. That would require the manufacturers to make an interface for it.

Most likely, it's just inline with the keyswitch. Ten minutes and a $10 cable tool and I'd have that out for you. And I'm not a mechanic.

More effective would be to engage steering lock permanantly somehow, but that would make the vehicle hard to move or tow. Plus that 6'4" coworker with all the tatoos and the harley could just break it for you. Of course, it makes it harder to hide the car...

Re:I dont think so... (0)

Anonymous Coward | more than 8 years ago | (#14153230)

It's only Grand theft auto if they steal alot of cars

hence the grand

as an aside.... (2, Interesting)

know1 (854868) | more than 8 years ago | (#14153099)

this kind of enter a pin number to start the car would stop a lot of car thefts probably. and maybe even drunk drivers (i know someone who had an unlock code for his phone that was ridiculously long so that he didn't make stupid calls when drunk, if he was so messed up he couldn't get it right he assumed it was a bad time to call)

Er.. (2, Interesting)

NereusRen (811533) | more than 8 years ago | (#14153102)

I fixed the summary for ya:

"I would think this 'Smart Box' would get hacked way too easily, leaving car companies exactly where they are now."

Surely it's not like this box makes it *easier* for someone to stop paying?

Michigan (2, Interesting)

lababidi (879163) | more than 8 years ago | (#14153106)

There are people in Michigan that leave their cars running during work. They do this because this device does not shut off your car in the middle of it being on. Too many accidents were caused by this. This is a normal thing among the Detroit area. Plus the sales lot that has this gizmo charges ubsurd interest rates and doesn't do a credit check and people still sign up!!

Re:Michigan (0)

Anonymous Coward | more than 8 years ago | (#14153176)

I call BS.

They don't have enough money to pay the loan but they do have enough to pay for gas to run the car all day? How do they fill up with gas? You know, gas stations get kind of antsy if you try and fill up with gas while the engine is running.

Re:Michigan (3, Interesting)

kagaku (774787) | more than 8 years ago | (#14153309)

A bit off-topic, but anyway; in the Chicago area I see people filling their car up with the engine running all the time during the winter months. I've done it myself occasionally, and it's not at all uncommon to see a whole station filled with running cars filling their tanks when it's below zero.

What about while they sleep? (0)

Anonymous Coward | more than 8 years ago | (#14153187)

They run it 24x7? Or jump it each morning?

The lawsuits on this one are frightning! (1)

mindmaster064 (690036) | more than 8 years ago | (#14153112)

Just image the lawsuits when someone who has one of these boxes is trying to get away from a criminal and flee to safety or some other similar emergency!

I guess this auto dealer likes writing the checks. Seriously though folks, I don't see why we can't just walk right down the street to "Joe's Auto" and buy the same car without the box and without the potential problems.

-Mind

Re:The lawsuits on this one are frightning! (0)

Anonymous Coward | more than 8 years ago | (#14153188)

You don't have the right to use a car to escape an emergency. You get what you pay for.

Re:The lawsuits on this one are frightning! (1)

tgd (2822) | more than 8 years ago | (#14153229)

You miss the point -- thats precisely where it'll get installed.

This is about people with bad credit.

And its nothing new. Its already done commonly in the high-risk loan industry.

If you have good credit, you'll never own a car with one. But when you get to a point where you've got a 25% interest rate on your car, and you have the option of a lien on your house, or one of these...

My sister is in high-risk loans. Her bank took someones house for defaulting on a car loan once. That guy, I'd bet, would tell you which he'd prefer.

The dealers need Microsoft... (1)

ViaNRG (892147) | more than 8 years ago | (#14153114)

Just use the planned "TPC 360" SmartBox by Microsoft, only $199 per unit wholesale.
Order now and receive free box or string with your purchase!

These aren't for everyone (5, Insightful)

CuriousGeorge113 (47122) | more than 8 years ago | (#14153119)

Before we get too far into the comments going on and on about how we wouldn't accept these in our cars and yadda yadda, we have to stop and remember one thing.

For the majority of people, you wouldn't need a system like this. Why? Because the majority of people, especially here, have reputable credit and can get a car loan, or have cash on hand to put a significant amount down.

I have a good friend who works in auto sales, and things in the used car business have become so bad, in terms of financing, that they were getting customers on the lot, essentially 'sold' them the car, and then couldn't get any banks to finance them. So what were they left doing? Financing the sale themselves.

Basically, you agree to pay the car dealership directly, instead of a bank. This puts a lot of pressure on the dealership, because instead of getting, say $12,000 upfront, in one payment from a bank, they are now getting monthly payments of $250 for the next 5 years or so. In doing this, they are really hanging their rear out, because if that customer makes two payments, and disapears off the face of the earth, that dealership has no way of tracking them, or their car, down.

That's why these systems are catching on so quickly, not as another form of 'big brother', but as an alternative for someone out there who needs a car, and can make payments, but can't get financed through a bank. This way, a dealership can move cars off their lot, and still protect their investment.

If you don't want a system like this in your car, the solution is simple, keep good credit. If you do that, then you'll be able to get bank financing, not get ripped off by a car dealership, and don't have to worry about 'big brother' in the passanger seat.

Re:These aren't for everyone (1)

ViaNRG (892147) | more than 8 years ago | (#14153159)

I agree with most of your post. But what happens when "SmartBox" manufacturers are able to bring the total cost for the dealerships down to near or equal the cost of loss from late payments, bounced checks, etc. Some cost benefit analysis in two or three years may put these units into the majority of car dealerships.

Re:These aren't for everyone (1)

CuriousGeorge113 (47122) | more than 8 years ago | (#14153233)

You said "Some cost benefit analysis in two or three years may put these units into the majority of car dealerships."

Yes, I can definately see that as a possibility. But I think there will be a significant force preventing that from happening: customers with good credit.

For instance, customer A with poor or no credit needs a car, and goes to 4 different dealerships, and no one can sell them a car because of the customers poor credit and the inability to get them financed. Finally, they go to the 5th dealership, and they agree to sell the car, with the condition of the 'big brother' box. Since they need a car, they comply.

Now, customer B with great credit goes to the same 5 different dealerships to get their car. All 5 are able to get customer B financed. Now, if this customer is looking at all other things being equal, their going to choose the best financing deal availble. I'm willing to say, this isn't going to include the dealership which installs the cut-off boxes.

So, while these are going to become more popular, I doubt we will ever see such wide spread adoption as your post suggests.

Great...what's next? (4, Funny)

FrankieBoy (452356) | more than 8 years ago | (#14153127)

How about banner ads running across my dashboard to reduce my payment?

Re:Great...what's next? (1)

huge colin (528073) | more than 8 years ago | (#14153219)

Um... if this ignition lock-out works to reduce the incidence of deadbeats, then your payment should already be lower.

Great Idea (1)

Shihar (153932) | more than 8 years ago | (#14153146)

I know a lot of people are going to immediately hate this idea, but I personally like it. I imagine the net result is that dealerships will be able to offer better deals to people with damaged credit. As it stands, giving a loan to a guy with poor credit to buy a car is a big risk. If the money never comes through, then they need to send out an expensive repo man to get back a car that now isn't considered new and might even be damaged. With this system, the risk is substantially reduced to the dealership. There isn't much incentive to fight to keep your car back if your car won't start. It makes everyone's life much easier. Further, I imagine that for people with good credit they won't even have this system in place.

This is nothing but good contract enforcement. Fail to pay for the property you took, and it becomes unusable until you do make the payment. Pay on time and there is no problem. Have good credit and I imagine they won't even bother with the extra cost to install this gadget. This isn't locking someone out of their computer because they are put in your shitty music CD. This is enforcing a contract in which you promised to delay full payment and make installment payments. Fail to keep up your end, and you loose the property that you took until you make good on your promise to pay.

Re:Great Idea (1)

thparker (717240) | more than 8 years ago | (#14153280)

I know a lot of people are going to immediately hate this idea, but I personally like it. I imagine the net result is that dealerships will be able to offer better deals to people with damaged credit.

The kinds of dealerships using these aren't going to pass along any savings in their repo costs or bad loans. But this is good technology nonetheless. It's also made possible Flexcar [flexcarnetwork.com] , which is a fantastic service. I live in a major city and use them all the time. It's the same deal -- I enter a PIN in the dash to be able to start the car.

I think these systems are pretty old news. The technology has been around for awhile and the lenders aren't pushing the envelope in terms of the law. Nothing to see here. Move along.

Re:Great Idea (1)

sumdumass (711423) | more than 8 years ago | (#14153317)

Yea, this is a great idea. Now my dealership can sell more cars to less qualified people and not have ot worry about them racking miles up on them after they can't make the payment that NO OTHER LENDER thought they could make. Now we can jusr colect the downpayments, a few weeks or months payments and then repo a car that isn't racking a bunch of miles up.

A problem i have is that this allows dealerships to further presure people who cannot afford to drive or own a car inot buying one. people need to live within thier means to a certain degree. All a loan does is extend those means for a short time. Credit isn't some magic blessing some people get so they can take loans out. It is a comparison of thier income to debt averaged with the likley hood of repaymeny. Those with good credit have a higher probability of repaying then those withbad but you can still have good enough credit with no or bad credit if you can actualyt afford the payments. I know a girl who filed bankruptcy after an extended time without a job, she then got a good paying job and within a year was buying a brand new lexis.

With these devices i see more and more people being presured into buying more then they can afford. You seldom walk into a dealership or used car lot and express interest in buying somethign without the salesman feeding you a line that sounds better then the first time you had sex. before you know it, your either buying an upgraded version or a different car that give a better comission. Now it will probably be both and they/you will live in the car because the rent didn't get paid instead of the payment for the car you couln't afford.

Don't even need to cut anything. (0)

Anonymous Coward | more than 8 years ago | (#14153205)

Push start a manual car with the key set to on and it can't beat you. Does it go "Hey the engine just started, but it's on so let's leave it on?" or does it shut the car back off?

Norfolk VA car dealerships (4, Insightful)

codepunk (167897) | more than 8 years ago | (#14153206)

I was in the navy and yes I was stationed in Norfolk, VA. Most of these used car dealerships in Norfolk area are some of the most sleazy joints I have ever encountered. I have seen some of them sell poor newbie sailors crap like a 500 dollar beat up pinto for tens of thousands of dollars. Hell I used to be a mechanic in the area and some of the patch jobs I did on engines and stuff for some of these sleazy dealerships was simply scary. They used to bring me stuff that had rings so shot that the cars looked like a mosquito fogger going down the road. I would swap out the oil with some good ole synthetic (does not smoke when burning) and shoot it down the road. The dealership would sell it to some fool with a 30 day warranty on the engine and laugh their way to the bank.

The state could step up and do something about it by applying reasonable intrest rate caps like a bunch of states do.

Re:Norfolk VA car dealerships (1)

jobugeek (466084) | more than 8 years ago | (#14153268)

Ever heard of buyer beware. If you aren't smart enough to have the car checked by someone else, you get what you deserve.

Who would hack this? (0, Flamebait)

AK Marc (707885) | more than 8 years ago | (#14153216)

Someone stupid enough that they buy a car they can't afford isn't going to be smart enough to hack the box. Those that do have a paycheck aren't going to mess that up hacking them for losers to stupid to hold a job.

Re:Who would hack this? (1)

CupBeEmpty (720791) | more than 8 years ago | (#14153293)

The truth is that even stupid non-l33t folks can just put a screwdriver across the solenoid contacts. Do you think that car mechanics are all gifted hackers? Hell no... go for the simple mechanical workarounds.

hacked? seriously? (1)

_isobel (580771) | more than 8 years ago | (#14153239)

I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money." yeah, and everyone that buys cars is l33t.

too much like "renting" (1)

Fooknut (73366) | more than 8 years ago | (#14153240)

I know that technically, the bank owns the car until it's paid off... but I'd never buy a car from a lot that did this. It's too much like asking permissions to use your own car.

What about when it's paid off?
What about if you're stuck in the wilderness and can't get the code even though the payment is auto-withdrawn... too many ways to screw the consumer.

I submitted this years ago!!!OMFG!!! (1)

Darth_brooks (180756) | more than 8 years ago | (#14153243)

Actually, these aren't all that new. A couple years ago a Ford Dealer in the Detroit area, Mel Farr (a former Detroit Lions Football player in addition to sleezy used car salesman archtype) drew some heat for installing similar devices in the vehicles of his, ahem, "higher risk" clients. The story hit the papers and caused a bit of a stir (and the link / story I submitted were rejected. I was heartbroken.)

As an aside, Mel Farr was run out of business by Ford after racking up close to 30 million dollars in debt. They got tired of his "the check's in the mail" line and simply "forgave" Farr's debts in exchange for his dealerships. Apparently the no-pay no-start devices didn't help with the used car business.

Good idea, wrong use (1)

the real darkskye (723822) | more than 8 years ago | (#14153244)

I'd have thought a system like this would be better implemented on rental vehicles rather than HP vehicles.

Of course there are all manor of comedy alternatives you could use this idea for ...

Missed a mortage payment? Your door doesn't open anymore.
Didn't pay your income tax this year? Your ATM card doesn't work anymore.

And the all time #1 idea ...
Please enter the five digit code so your heart can beat for this month.

I Developed a Competing System--and learned... (5, Informative)

John Murdoch (102085) | more than 8 years ago | (#14153279)

A few years ago I developed a GPS-based system for tracking vehicles. Long story, but the client's original business plan didn't work--but his sales manager cottoned on to the idea of installing the units in cars at buy-here, pay-here car lots.

I bitched and moaned, and eventually dropped the client--in part because of the liability exposure, and in part because of the general sleaze. But I learned a bunch along the way.

How buy-here, pay-here car lots can do this:
It's simple: when you "purchase" a car from a buy-here, pay-here car lot, you're not buying the car. What you're doing is technically signing a "lease-purchase" contract: you're leasing the car until the final payment is made. That means the car dealer doesn't have a secured interest in the car--he OWNS the car. If you miss a payment, he picks up the car--and you have nothing.

That's dramatically different from a typical car purchase. If you buy a car from a new car dealer--or a reputable used-car lot--you will almost always finance the car. If you finance the car at the dealer (generally not a good idea) you'll sign something that looks like a loan agreement, but is technically called a Retail Installment Sales Contract (RISC). It is a contract to pay for the car over a certain period of time. The dealer then sells that contract to a bank or finance company. Key point: you are buying the car, and signing a contract to pay a loan--securing the loan with the car's title. Suppose you buy a $25,000 car, and put down $5,000 in cash and trade-in on your old car. Suppose you lose your job two weeks later, and can't pay the loan. You tell the bank--they'll be perfectly willing to take the car, liquidate the loan (by selling the car at auction), and give you the difference between what they sell the car for, and the balance on your loan.

With a lease-purchase agreement, it doesn't work that way. The car belongs to the dealer, not to you. If the dealer suckers you into putting money down, you have only the contract language (if any) to guarantee that you'll get anything back if the car is repossessed.

Buy-here, pay-here is a very bad deal
Bottom line: if your credit is so bad that you have to agree to install any kind of automated device to track you or force you to pay, you shouldn't be buying a car. First, you clearly are going to have trouble affording the car. Second, the cars the buy-here, pay-here crooks sell are typically heaps of junk: the cars left over at the auction that nobody wants to buy. A 1992 Ford with 150,000 miles on it isn't just going to require a monthly (or weekly) payment to the dealer--it's going to require a steady stream of parts and repair bills to keep rolling. Your chances of keeping that heap rolling for the two or three years of the "loan" are slim: and if the heap dies, you're still stuck paying credit card interest rates, and you don't have wheels.

Not New (5, Informative)

ChristopherEddie (935213) | more than 8 years ago | (#14153328)

I own and operate a used car lot. The devices we use are by a company called Passtime. The type of operation we have is a buy-here-pay-here lot that attracts a lot customers with sub-prime credit, and we haven't had a single customer not buy a car because of the device. The fact is, if they won't agree to having the device on their car, they probably won't pay (keep in mind, these are sub-prime customers). We usually weed them about before they even come inside!

The device is quite easy to "hack" if you would even call it that. Its just soldered to the wiring harness and can VERY easily be bypassed. Most customers don't question it because "its a little computer thingy" and its "very complex".

Apart from all that, in the contract, the customer must sign about three pages of forms made up of about 15 signatures from both buyer and co-buyer agreeing to all the terms and conditions regarding the device. Again, our customers never have a problem signing their John Hancock on the line.

About the operation of the device: Currently, the device we use utilizes a "code" system where the customer pays their payment, we give them a 9-digit code from Passtime's website. The code is only good for however many days we set it, then we can set warning days where it will beep upon starting to remind them that their payment is due, and each code has atleast two emergency days that they can use by pressing 999-999-999.

Regardless, it'd be nice if Passtime would give me the freakin' code to generate the Passtime codes so I can integrate it into my software! They protect it quite well, thankfully!
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