{"id":28574,"date":"2026-04-20T00:28:16","date_gmt":"2026-04-20T00:28:16","guid":{"rendered":"https:\/\/finprosalerts.com\/?p=28574"},"modified":"2026-04-20T00:28:24","modified_gmt":"2026-04-20T00:28:24","slug":"how-to-get-out-of-an-upside-down-car-loan","status":"publish","type":"post","link":"https:\/\/finprosalerts.com\/?p=28574","title":{"rendered":"How to Get Out of an Upside-Down Car Loan"},"content":{"rendered":"
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If you\u2019ve got an upside-down car loan, you\u2019re not alone. In fact, the number of drivers who owe more on their car than it\u2019s worth continues to go up.1<\/sup>\n <\/p>\n

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Pay off debt fast and save more money with Financial Peace University<\/em>.<\/p>\n<\/p><\/div>\n

But no matter how underwater you are on your car, you can<\/em> come up for air! Let\u2019s talk about how to get out of an upside-down car loan once and for all.\n <\/p>\n

How to\u00a0Get Out of an Upside-Down\u00a0Car Loan<\/h2>\n

Being upside down on your car loan is frustrating and can be downright scary. Not only are you continuing to lose money on the car as it depreciates (or loses value), but you also run the risk of missing payments and having your car repossessed.\n <\/p>\n

The good news? There are steps you can take to get out from under it. Here\u2019s what to do:\n <\/p>\n

1. Calculate the negative equity.<\/h3>\n

First, you need to know how deep of a hole you\u2019re in by calculating your negative equity. Just take whatever you still owe on your car and subtract the amount you could get for your car if you did a private sale. (A quick search on\u00a0Kelley Blue Book\u00a0will let you know.)\n <\/p>\n

Remaining Loan Balance \u2013 Private Sale Value of Your Car = Negative Equity<\/strong>\n <\/p>\n

2. Decide if you want to sell the car or pay off the loan early.<\/h3>\n

Once you know exactly how much you\u2019re upside down on the car loan, you\u2019ve got a couple of options. Let\u2019s look at each one so you can decide the best course of action for your situation:\n <\/p>\n

Option 1: Sell the car and get a personal loan for the difference.\u00a0<\/h4>\n

If you want to quickly get out of an upside-down car loan, you can sell the car and take out an unsecured personal loan for the difference to pay off the car loan.\n <\/p>\n

We normally wouldn\u2019t tell you to go into debt with a personal loan. But in this case, it can help you get out of a bigger mess and keep the car from dragging you even further underwater. Plus, you\u2019d (hopefully) have a lower interest rate with a personal loan.\n <\/p>\n

You\u2019ll get more for your car if you do a private sale (you can advertise on sites like Craigslist or Cars.com), rather than selling it to a dealership. You just need to let the buyer know you\u2019ll have to pay off the car loan first before you can give them the title.\n <\/p>\n

You can even meet the buyer at the lender\u2019s office to speed up the process. That way, you just use the money from the sale (plus the personal loan you took out to cover the difference) to pay off the car loan. And then as soon as the bank gives you the title, you can hand it to the new owner.\n <\/p>\n

You\u2019ll also need to find a cheap replacement car you can drive temporarily while you save money to buy a better car down the road.\n <\/p>\n<\/p><\/div>\n

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Option 2: Save up the difference and then sell the car.<\/h4>\n

If your\u00a0credit score\u00a0is too low to get approved for a personal loan, you can hold off on selling the car until you save up enough money to pay off the difference. Just be sure to keep making your car payment each month while you save.\n <\/p>\n

There are plenty of quick ways to save up the cash you need to cover the difference\u2014get on a budget, cut extra spending, or pick up a side hustle. Whatever you do, don\u2019t slow down! Because remember, as long as you\u2019re underwater, you\u2019re losing money. You want to get this loan out of your life!\n <\/p>\n

Option 3: Keep the car and pay off the loan early.<\/h4>\n

If you want to get out of an upside-down car loan but you don\u2019t want to sell your car, you could decide to pay off your car loan early.\n <\/p>\n

But first, you need to ask yourself a couple of questions:\n <\/p>\n