How do you get out from being upside-down on a car loan?

Is there a way I can get out from being upside-down on my car loan? I want to trade-in my car, but I don’t want to lose money on it when I do.

Answer
The stress of an upside-down car loan can be overwhelming, but you do have options! Here are a few things that you can do to get out from being upside-down on a car loan:
  • Pay off the loan. If you’re financially able to pay off the remaining balance on your loan, this is your best bet. Not everyone can do this, but it is the fastest way to dig yourself out of an upside-down car loan.
  • Ask your lender. Find out if your lender allows extra payments or can adjust the terms of your loan.
  • Refinance. If you can’t adjust the terms of your current loan, it might be a good idea to find a new one. Refinancing your car could get you a better interest rate, or you could opt for a shorter repayment period to pay off your loan more quickly.
  • Sell your car. If you can’t find a way to get on top of your car loan, it might be time to sell the vehicle. If you sell your car rather than trade it in, you might be able to pay off the loan with the profits before you purchase a new vehicle.
If your financial situation has changed since you took out your last auto loan, it may be time to refinance. Download Jerry to see if refinancing your car loan can save you hundreds of dollars per month.
Liz Jenson
Answered on Dec 03, 2021
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