Here’s a hypothetical situation that unfortunately isn’t that uncommon for auto buyers with less than perfect credit. Let’s say you needed a vehicle but were only able to obtain an interest rate way over 20 percent APR. Moreover, you financed for longer than the number of years you expected to own the car. These are hard things to swallow financially, but you figured that by making your payments, you’d begin to repair your credit.
Unfortunately, the quickness in which the value of a car depreciates is staggering. You found yourself in a predicament where you owed double on your loan than what the car is actually worth!
This is what’s called an upside down loan
What if I’m upside down on my loan? It’s a legitimate question. Sometimes unscrupulous dealers or lenders will convince you that a high-interest loan is the only way to go and that you’ll be able to afford it. Check with your State Consumer Affairs office to see if you have legal recourse against such tactics. Ultimately, this is why it pays to shop around before jumping on the first offer you’re given for auto financing. Car Deal Expert can help consumers eliminate that guesswork, as we strive to deliver the best possible interest rate available.
If you’re stuck with an upside down loan, don’t think you’re alone. Money Magazine recently ran a survey in which they found that around 30 percent of new car owners were upside down in their car loans. Selling the vehicle typically won’t help, because you’ll only receive what the vehicle is worth and still owe all that extra money in interest. The same holds true with a trade-in. The only way you’d get any satisfaction is to trade down for a much less expensive vehicle, but that may not be possible in your situation.
What can you do?
Keeping the car until it’s paid off is one way to deal with an upside down loan. It’s a much better option than allowing the car to be repossessed, as the value it will garner at auction won’t even be close to what you owe.
How about an auto refinance loan?
Car Deal Expert recommends that you consider an auto refinance loan if your current auto loan is upside down. This could drastically reduce your monthly payments and save you thousands of dollars over the life of your auto loan.
We work with all kinds of lenders, and we strive to find you the best terms possible for your credit situation. Even if you’re only able to decrease your APR by a single percentage point, it’s worth attempting to pre-qualify for an auto refinance loan. Car Deal Expert recommends that before you do, you know where your credit score is at. Contacting Equifax, Experian or TransUnion is all you need to do here, but it’s important that you do it, rather than relying upon someone else to do the work. It’s the only way you’ll know for certain where you stand before entering into loan negotiation.
Car Deal Expert is your auto refinance loan source
If you’re upside down on your current auto loan, don’t worry. We may be able to help you. If you are:
- At least 18 years old
- Earning at least $1,500 per month
- Currently employed for at least six months
- Free of bankruptcy
Then Car Deal Expert can work fast to try and help. Our rates are also typically lower than what dealers will offer you, so there’s nothing to lose and potentially everything to gain.
An auto refinance loan may be able to help you escape an upside down loan. Car Deal Expert can help you pre-qualify today! CLICK HERE.[apply_button]