At Freeman Grapevine, we get asked all of the time by new car buyers: “What does it mean to be “upside down” on your new car?” Well, simple put, you owe more than the car is worth.
The first step to getting out of this crazy situation is to understand that you are not alone. Roughly 30% of people in the United States are in similar situations, and what’s more is that many of these people are in this situation from the get go. That’s right…almost the moment they drive off of the lot. Sometime you gotta’ do what you gotta’ do when you need a new car.
Now that you know you are not alone, the next step is to take stock of what your current options are.
One of the more common strategies people use to get out of such situations is to try and sell the car. Unfortunately, unless you are able to sell the car for what you owe, you are still responsible to pay the loan in full, regardless of who actually owns the car. Another common strategy is to trade in the car that is upside down for a new vehicle. While this may get you out from under one inverted car loan, it is going to put you right back under another one.
This is great advice:
The best thing you can do is finish paying that car off and then sell it or use it as a trade. If you are upside down, you are probably going to want some guidance as to how you can get back on your feet. That’s where Freeman Grapevine can help.
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