Feeling the pinch at the pump and the grocery store? You’re not alone—and it’s not just happening here in Mumbai or Jakarta. In the U.S., skyrocketing living costs are leaving more drivers in deep water.
Research shows “underwater” auto loans—where you owe more than your ride is worth—are at their highest level in four years. With monthly EMIs climbing alongside rent, food, and fuel prices, American car owners are now stuck with bigger bills and less equity in their wheels. 😬🚗💸
What’s driving this trend? Experts point to a few key factors:
- High inflation: Daily essentials are pricier than ever.
- Prolonged low interest rates: Encouraged bigger loans.
- New car shortages: Pushed buyers to pay premiums.
Sounds familiar? Many of us in SEA and South Asia juggle similar pressures—whether it’s smartphone EMIs, education loans, or bike financing. The tip? Keep an eye on your loan-to-value ratio (LTV). That’s just a fancy way of saying “what you owe vs. what it’s worth.” Aim for an LTV under 100% to avoid underwater status. 📊
For those already underwater:
- Refinance at lower rates if you can.
- Make extra payments when possible to build equity faster.
- Consider a shorter loan term to pay off the balance sooner.
In a fast-paced financial world, staying informed is your best tool. Whether you’re buying your first scooter in Delhi or your dream car in Los Angeles, understanding loan dynamics helps you keep your wheels—and your wallet—rolling smoothly. 🛵🚘✨
Reference(s):
cgtn.com
