Apparently, about 15 percent of the car-buying public is paying that much – or more – each month, on a car payment.

Not counting the costs on top of that.

But can those 15 percent afford it? The credit reporting agencies are doubtful. They point to alarming loan-to-value ratios that are increasingly tilted in the direction of default, as the car is worth less than the loan outstanding. This being a function of depreciation. The car's value declines with each month, but the monthly payment remains the same. In fact, it goes up – as a practical matter – as the value (buying power) of money goes down.

It is most alarming in the used car market, where the cars depreciate even faster and the loans are more expensive, because the interest applied to them is higher.

According to J.D. Power, the loan-to-value ratio in this market is now 125 – which when parsed means the loan balance outstanding amounts to 125 percent of the market value of the vehicle.