Explore Options If You're Upside Down On Your Car Loan
Upside Down on Your Car Loan? Explore These Options
Being "upside down" or "underwater" on your car loan means you owe more on the loan than the vehicle is currently worth. This is a stressful financial situation to find yourself in, but there are some options available that may help. As your local Santa Maria car dealership, Toyota Santa Maria is here to provide some guidance if you're upside down on your car loan.
Option 1: Keep Making Payments
One option is to continue making your regular payments until you catch up and are no longer underwater on the loan. You can accelerate this by making additional payments toward the principal balance when you're able to. The faster you pay down the loan, the quicker you'll get back to a positive equity position.
Option 2: Refinance Your Loan
Another possibility is refinancing your current auto loan. If your credit has improved since you originally financed the car, you may qualify for a lower interest rate. Refinancing with a lower rate and/or a longer loan term can help make your monthly payments more affordable while you work on paying down the balance. However, keep in mind that extending the loan term means you'll pay more in interest over time.
Option 3: Trade In Your Vehicle
In some cases, trading in your current vehicle for one that's less expensive can improve your situation. If the dealership offers a fair trade-in value relative to what you owe, this can help you get out of the existing loan and into a new one with a lower balance and more manageable payments. We can assess your situation and discuss possibilities for a trade-in here at Toyota Santa Maria.
Learn More at Toyota Santa Maria
At Santa Maria dealership, our finance team is here to help. They'll go over your unique situation and help you weigh your options. We're committed to working with you to find a solution that best meets your needs and budget. Feel free to contact Toyota Santa Maria or visit us to discuss your car loan in person.
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Toyota Santa Maria
1643 S. Bradley
Santa Maria, CA 93454
- Sales: 805-928-3881
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