For some, a vehicle is not a necessity. Those who live in a city with readily available public transportation can often do just fine without owning a car. But for those of us who live in rural areas or have to commute a long way to work, having wheels of our own is essential.

A car is usually one of the biggest expenses we incur, second only to our homes. But unlike a house, which usually goes up in value, automobiles lose value. And when you buy one that’s new or nearly new, it loses value very quickly.

When someone is said to be “upside down” on their car loan, it simply means that they owe more on it than the vehicle is worth. This often occurs when someone finances a new car for a term of several years. But it can also happen with used vehicles. Sometimes they lose value more quickly than you can pay the loan down, and sometimes dealers charge buyers more than the car is worth in the first place.

Read more on What to Do When You Are “Upside Down” on Your Car Loan…