In most cases, the answer is no. Being upside down on your auto loan means that you owe more than what the car is currently worth. This makes it incredibly difficult to refinance your loan because the new lender will use the car’s value to determine how much he or she is willing to lend. For example, a lender may consider lending $15,000 on a vehicle that’s worth $17,000. If by some chance you default on the loan, the lender can repossess the vehicle, sell it, and recoup some of the money lost by your backing out of the deal. But if the lender extends a $20,000 loan for a $17,000 vehicle — and you default on the deal — then he or she takes, at minimum, a $3,000 loss on the loan. We’ve yet to find a lender who is OK with taking a loss. The best way to obtain refinancing on a loan that you’re upside down on is to make extra payments to your existing lender until your loan-to-value ratio improves and you owe less than the car is worth. Once you’re no longer upside down on your loan, the lenders listed above will be more likely to consider your application for refinancing.