Negative Equity Calculator
Find out if you are underwater and see when you could break even.
What This Tool Does
Compare your car's current value to what you still owe and see how equity changes over the next year.
Who Should Use This
Anyone thinking about trading in, refinancing, or selling a financed vehicle.
What You'll Get
Equity position, trade-in impact, and a break-even estimate based on your loan details.
1Enter Your Details
Your Equity Snapshot
You are underwater by $4,500
Your loan balance is higher than your car's current value.
Added to new loan
Assumes 1% monthly depreciation
Trade-in impact
If you trade in today, $4,500 will be added to your new loan.
Break-even estimate
Estimated break-even in about 22 months.
Equity Timeline
Equity = Value - BalanceProjections assume a 1% monthly depreciation rate and fixed monthly payments. Interest rate is optional but improves accuracy.
Understanding Negative Equity
What is it?
Negative equity means you owe more on your loan than your car is worth. It's common early in a loan when depreciation is faster than your payoff schedule.
Why it happens
Cars lose value quickly, especially in the first 1-2 years. If you financed most of the purchase price, the loan balance can stay higher than the vehicle's value.
Options if you're underwater
- Keep the car longer while you pay down the balance.
- Make a lump-sum payment to reduce the gap.
- Refinance to a lower rate or longer term (if it helps).
Rolling negative equity
Rolling the balance into a new loan increases your payment and keeps you underwater longer. Avoid it if possible.
If you're unsure about next steps, compare financing options or simulate credit changes before trading in.