How to Get Out of an Upside Down Car Loan
Financing a vehicle is always tricky, and sometimes you can find yourself in less-than-ideal situations, such as discovering you have an upside-down car loan. Upside-down car loans are unfortunately quite common among drivers often due to circumstances they could not control. If you’ve found yourself with an upside-down car loan, there are a few solutions that can help you get to a better spot financially. Continue reading to learn how to get out an upside down car loan with suggestions from the team here at Mercedes-Benz of Scottsdale.
Upside-Down Car Loan Solutions
Keep Your Vehicle | The most obvious solution to an upside-down car loan is to keep your vehicle and continue to make payments until you owe less than the vehicle is worth. Once you pay your way out of the upside-down status, you’ll be free to trade in or sell your vehicle and walk away with a bit of cash. However, this isn’t always the best solution especially if your vehicle needs repairs.
Refinance Your Loan | Another option is to refinance your auto loan if you can receive reduced interest rates. High interest rates prevent you from paying a car off sooner so refinancing will allow you to save money in interest. You can also opt to put more money towards your car loan each month to help pay it off faster, as well.
Trade In & Lease | The third and most popular solution is to trade in your vehicle–but not to refinance a new one, as most people initially assume. Leasing is a great solution to getting out of an upside-down car loan, as dealerships will pay off your car loan for you and roll it into your new lease contract interest-free.
The team at Mercedes-Benz of Scottsdale is here to help. Interested in trading in and leasing? Visit us today!