A recent article showed that the average car loan size has risen to $85,000. And I am pretty sure property loan sizes are also on the rise due to higher prices. Not surprising, loan tenures are also increasing to the maximum allowable length. This represents that affordability is being stretched to the maximum. Though some may argue that it is due to low interest rates that it makes economical sense to maximize the loan, but there is good debt and there is bad debt. This loan is on a depreciating asset, it falls in the bad debt category.

When times are good, everything is rosy, it is easy to get complacent and take on debt bigger than one can chew just for that instant gratification. However, this is going to be a huge concern when a down turn occurs. Most will experience serious cash flow problems as these loans are ......