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Have you been looking around Garland to value your trade with your old car? Suddenly, you’re told the car no longer retains the same value and what you owe is an upside down car loan. An upside down car loan simply means that the amount you still have to pay back is higher than the car’s value.
How do you escape negative equity? The financial experts at Rusty Wallis Honda have a few recommendations on how to get out of an upside down car loan.
Here are some potential solutions for Mesquite drivers faced with how to get out of an an upside down car loan:
Though time consuming, the easiest solution is to keep paying down your car loan until it is complete or less than the car’s current value. When it comes time to sell the vehicle, you’ll have greater equity.
You can build equity fast and pay off the loan faster when you pay more towards the monthly principal. Check to make sure there aren’t any consequences with doing so first.
If interest rates on the loan have dropped since you took out the loan, refinancing might be a feasible option.
Instead of trading it in to your local Richardson dealership, you have the option of selling it to a private party.
You can also sell the car and then take out another loan to cover the remaining amount owed.
Some dealerships allow you to trade in an upside down car. However, beware – while the dealer agrees to pay for the loan upfront, the existing balance is added to the loan of the new vehicle. If you’re looking to sell a car with a loan to a dealer, you also need to make sure the loan balance has been paid off.
Still unsure how to get out of an upside down car loan? You can still sell a car with a loan to a dealership like Rusty Wallis Honda. Otherwise, consult our financial experts for more tips on how to get out of an upside down car loan.
