What is an upside-down car loan?

I've heard this term thrown around before. What does it mean?

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Eric Schad
Answered on Apr 07, 2021
“An upside-down car loan is a fairly common type of occurrence where the borrower owes more money on the vehicle than the value of the vehicle. Oftentimes, this happens as soon as you drive off the lot, as new cars can instantly lose 10% to 20% of their value after leaving the dealership. “
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