Americans face record negative equity in vehicle trade-ins as costs and loan terms rise
Updated
Updated · MarketWatch · Apr 28
Americans face record negative equity in vehicle trade-ins as costs and loan terms rise
10 articles · Updated · MarketWatch · Apr 28
Nearly 31% of US vehicle trade-ins now have negative equity, averaging $7,183 owed, the highest in five years, according to Edmunds.
Longer loan terms—72 months or more—now account for over half of new car loans, slowing equity buildup and increasing financial risk for frequent trade-in buyers.
Rising new car prices, cooling used-car values, and higher ownership costs drive this trend, with consumers who roll over negative equity more likely to face repossession and financial strain.
As affordable new cars vanish, is the American dream of ownership becoming an inescapable debt trap?
With debt cycles worsening, will automakers be forced to bring back the under-$30,000 car?
With repossessions at a Great Recession high, is the auto loan market heading for a 2008-style collapse?
Beyond personal finance tips, what systemic changes can break America's cycle of negative car equity?
Are seven-year car loans a necessary tool for affordability or simply a predatory lending tactic?
Are plummeting used EV prices a buyer's dream or a depreciation nightmare?