Hang on to SUV if you’re ‘upside down’
Every day, I get at least one e-mail from a reader who is stuck with a vehicle, owing more than it is worth — a situation known as being “upside down” on the loan.
I expect the volume of such complaints to pick up.
The main reason is that after more than 10 years of trucks, SUVs and minivans being the top-sellers in the U.S. market, the ride has come to an abrupt halt.
Now, buyers who took out six- and seven-year loans to buy big pickups and SUVs in the last few years are in even more dire straits than they normally would be with such long-term obligations.
The value of used trucks and SUVs has plummeted, making owners of those vehicles even more upside down.
How far have values fallen?
From a year ago, wholesale values of used trucks and SUVs have dropped more than 20 percent. That means a 2003 Chevy Tahoe, valued last year as high as $15,000, now would be lucky to bring in $12,000.
As gas prices continue to rise, the values will drop even more.
Dealers say they see a lot of customers coming to their lots seeking more fuel-efficient vehicles but owing as much as $10,000 more than their current SUV is worth.
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