The box-like device is often installed inside the vehicle, usually underneath the car’s dashboard. It seems like an ordinary box and may look like an external modem or a router but the thing is, your car needs no internet connection connection. So what’s this box with six buttons doing inside your car?
Get ready for a device that will wake you up when payment for your car is due. The box is actually an On Time car device that starts to blink when your payment is fast approaching and then starts beeping on the due date itself. This box blinks for a purpose; and that’s to drive the vehicle owner to make their payment on time. Just in case you dismiss the beeping sounds coming from the device and foregoes payment and the resulting code punched in will reset the box, your valued car will not start. The idea behind this smart device came from anti-theft devices based on radio frequency identification or RFID technology. If the driver takes notice and payment is made, the lender will give the car owner a six digit code to input on the device, which of course can stop the device from flashing and beeping at the same time.
Problems with defaults and late payments is a serious issue and this specific problem have been growing for years. In fact the rise of the default rates has been likened to the mortrage crisis. In fact the rate of auto loan defaults has reached a 10 year high of 3.4 percent.
With the introduction of this kind of device, default rates for subprime auto loan borrowers are significantly lowered. What this means is that when repo rates and default rates are down, the dealers and the lenders will feel more secure in offering financing for more valuable and pricier cars. Discipline is also enforced amongst the buyers and the car owners.