Your Loan Situation

New Vehicle Price ($)

Enter a valid vehicle price.

Negative Equity Amount ($)

The amount you owe beyond your trade-in value

Enter a valid negative equity amount.

Cash Down Payment ($)

Any additional cash you're putting down

Annual Interest Rate (%)

Enter a rate between 0% and 100%.

Loan Term (months)

What Happens When You Roll Over Negative Equity?

When you trade in a vehicle worth less than you owe, the difference (negative equity) is added to your new loan. This means you're financing more than the new vehicle is worth from day one — a practice sometimes called "rolling over" or "stacking" debt.

The immediate consequences are: a higher monthly payment, more total interest paid over the loan term, and the risk of being immediately underwater on the new vehicle as well — creating a cycle of negative equity.

California BHPH and Negative Equity

BHPH dealers in California are legally permitted to roll negative equity into new contracts. At interest rates of 18–29%+, rolling even a small negative balance dramatically increases the total cost of the new loan. If possible, pay off the negative equity separately rather than rolling it in.