What Is an Upside Down Loan?

Posted: Sunday, January 7th, 2018

If your car loan is “upside down,” that means you owe more on the loan than the car is worth. If you want to avoid your loan flipping upside down, it’s good to keep this information in mind:

  • As a car ages, it undergoes depreciation, meaning that its value drops over time.
  • If you have a long loan term, this means your loan is more likely to be upside down.
  • If your loan is upside down and your car is totaled in an accident, you could still end up owing money after insurance pays their part.
  • A trusted loan provider can help you avoid an upside down loan.

Find out more about upside down loans today!

Tips to Avoid Going Upside Down on a Loan

Green Light Customer and Sales Person with Car
  • Loan Length
    • If you can afford it, a shorter loan term length will minimize the risk of going upside down, as you’ll be gaining value more quickly.
  • Consider Depreciation
    • Some cars loose their value quicker than others. Be sure to do your research ahead of time and pick a car that retains its value.
  • How Much Can You Afford?
    • Find out how much you can pay on a month-to-month basis, then figure out the kind of car you can afford.
  • Ask for Advice
    • As a fixture in the St. Louis community, Green Light Auto Credit can help you avoid going upside down on your next car purchase.

Green Light Auto Credit Can Help Keep You Right-Side Up

Whether you’re looking for an affordable family sedan or an SUV with the latest tech features, Green Light Auto Credit can help. We offer a wide variety of loan packages and will work with you to find one that keeps you from going upside down. In addition, our wide network of dealerships gives you more selection that an in-house financing department. One of the best ways to avoid going upside down is to buy a car you can afford, and that’s where Green Light Auto Credit’s superior selection really comes in handy.

Before you visit us, be sure to take the following steps:

Any questions? Give Green Light Auto Credit a call at 800-200-5551.