A poor equity auto loan — generally known as being “upside down” or “underwater” on that loan — means you owe more about a vehicle than it is worth, plus it’s a far more typical situation than you possibly might think.
Almost one-third (31.4%) of car owners presently are upside down on the auto loan, meaning they will have negative equity. United States Of America Today reported something a lot more concerning: “The percentage of automobile owners dealing with equity that is negative likely to strike a 10-year full of 2016. ”
How can individuals get upside down on the cars? The minute they’re driven off the lot for one, brand new cars lose an average of 11% of their value.