let us say that you purchased your car for $25,000. A few years later, it is now only worth $15,000. If you're still paying off your car loan by then and you still owe more than what the car is worth now which is $15,000, then you are definitely upside-down. Being upside-down on a car loan can also happen in other ways: If you pay a very small down payment for the car or no down payment at all. In this case, you'll be paying a lot more in interests and guaranteeing that you pay more than what the car is really worth. If you buy a car without doing your research. It's easy to overpay for a car if you don't know its true value. You may purchase a car for $25,000 when in truth it's now only worth $20,000. The chances of this happening are even bigger if you happen to deal with a particularly unscrupulous car dealer. If you add too many options to your car. No matter how many fancy features you add to your car these don't add to the value of the car, they only add to your expense, thereby increasing the chances of turning you upside-down. If you're already upside-down on one car loan and are planning on getting another one for another car. Most dealers will just roll the amount you owe on the old car over to the new one without even telling you. Being upside-down on a loan is quite