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Wisconsin | I understand I'm not a flipper or car jockey that's going to make money buying and selling used cars. That's not the point. PVA made the point about being underwater on groceries, but I don't buy milk on a credit card, not that there's anything wrong with that, but that's the actual point of being underwater, making minimum payments and paying interest on milk that expires would be "being underwater" on groceries. I buy a gallon of milk with no interest, and it's used over a few days. You can buy a vehicle new or used with a DOWN PAYMENT and have equity immediately or soon, that doesn't mean you made money on the deal, just that it's not a net negative on your "balance sheet".
The point of "underwater loans" is there is no equity, new vehicle dealers have long been willing to take that risk, but now they extend out used car loan terms to make the payment attractive, and allow people to trade up by rolling the old loan into the new one. That's underwater, not just spending money on a vehicle to fill a need.
Equity in a depreciating asset is not a "myth", lots of people have equity in their vehicle, it can help you buy a home or get other loans, while an over financed vehicle loan will hurt you getting another loan. You can easily get a loan on a vehicles equity if it meets the conditions (newer than 10 years it used to be), the whole point of this is not zero equity, or depreciating vehicles (they depreciate much slower than they used to), the point is substantially underwater vehicle loans, like used vehicles with new vehicle terms, or rolled over loans spread out way too long.
Edited by junk fun 8/2/2026 15:44
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Car loans
