Financing with Negative Equity


Financing with Negative Equity – Yes, It’s Possible!

One of the most common obstacles keeping Louisville area auto buyers from purchasing a car, truck, or SUV is the belief that they owe too much on their current vehicle. The purpose of this page is to explain the concept of negative equity, how it happens, and how car buyers with negative equity purchase vehicles.

What is Negative Equity?

Equity is the difference between what is owed on an auto loan and the vehicle’s current value. Also known as being “upside down” or “under water,” negative equity occurs when a borrower owes more than the vehicle is worth. This typically happens when a buyer chooses financing with no money down, as well as vehicle depreciation (the gradual decline of a vehicle’s value).

It is important to understand that depreciation affects each vehicle in a different way. Not all vehicles depreciate at the same rate and it is difficult to predict how much your vehicle will be worth in the future.

The best way to determine any potential negative equity is to submit a quick evaluation of the trade vehicle.

Click the banner below to value your trade.

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How Does Depreciation Happen? How Does it Affect Negative Equity?

Like all items of value, vehicles are evaluated on a variety of factors. Among the items affecting depreciation are:

  • Vehicle Age

    • How old is the vehicle? Is it still under the factory warranty?

  • Mechanical Condition

    • Does the vehicle run well? How are the brakes, transmission, engine, etc.?

  • Cosmetic Appearance

    • Does the vehicle have dents, dings, or scratches? Are the mirrors or windows cracked?

  • Mileage

    • Vehicles with higher mileage are typically valued less than lower mileage vehicles.

  • Service History

    • Has the vehicle received regular maintenance? Is the vehicle under recall? 

How Financing With Negative Equity Works

When auto buyers find themselves with negative equity, they often wrongfully assume that they cannot purchase a vehicle. Owing more than a vehicle is currently worth is not uncommon and obtaining financing with negative equity is certainly possible. 

In most cases, purchasing a vehicle with negative equity can be accomplished in three ways:

  • Utilize down payment money to lessen or eliminate existing negative equity

  • Roll exisiting negative equity into the new vehicle’s loan amount

  • Enhance your trade vehicle’s current value by fixing existing mechanical and/or cosmetic issues

Oxmoor Auto Group = Experts in Auto Financing with Negative Equity!

Why is Oxmoor Auto Group so successful in getting Louisville area drivers approved for financing with negative equity? One reason is our large network of special finance lenders. As one of the oldest and largest auto groups in the state of Kentucky, we’ve cultivated a large portfolio of financial institutions that focus solely on special financing.

Not only do these lenders help buyers purchase vehicles with negative equity, but they also help buyer achieve financing with a bankruptcy, financing with no money down, and financing with low credit scores.

In addition to our lending partners, our Special Finance Advisors have the experience and expertise necessary to secure you the highest value at the strongest possible terms. Their primary goal is to match borrowers with a vehicle that not only suits their specific needs, but is also affordable. 

Ready to get started? Click the banner below.

Application Auto Financing With A Bankruptcy Louisville KY

Questions? Click the phone to speak with a Special Finance Advisor now!