Jul 2010 15

Boston Nissan Dealer Tips: Dangers of Negative Equity

Avoiding negative equity when purchasing a vehicle from a Boston Nissan dealer is an easy way to get the best monthly payment possible on the new Nissan cars of your dreams. Negative equity occurs when the trade-in value of your current vehicle is less than the trade-in offer made by used Nissan dealers. If you roll the remaining balance into a new loan, you are financing negative equity, and a portion of your new loan includes refinancing the unpaid balance of your old loan. Below are some of the pitfalls of negative equity:

Difficult to Get Financing. MA dealerships have lenders who can get you financed at a Boston Nissan dealer, even with negative equity. However, in some cases, the difference between your trade value and payoff is so large that it is difficult, if not impossible, to secure financing without a down payment to offset some of the negative equity.
Higher Monthly Payments. Financing negative equity increases your monthly payment. Although $1,000 of negative equity may only raise your payments $20 each month, thousands of dollars in negative equity can raise your monthly payment by over $100 each month. This also means you are paying additional, unneeded interest on your old loan for a car you no longer have.