Originally published at Auto Spot DFW

Pie chart illustrating that 20% of US new car buyers rolled negative equity into auto loans in 2024.

Avoid Car Loan Traps: Negative Equity Roll Over in Irving, TX

By the Auto Spot DFW Team | Expert Automotive Analysts | Updated October 19, 2025

Quick Answer

In 2024, about 20% of new car buyers rolled over negative equity into their auto loans.

Key Takeaways:

The average negative equity rolled over in Irving ranges from $3,000 to $8,000 per trade-in.
Rolling over each additional $1,000 of negative equity can increase monthly payments by $18 to $22.
Customers rolling over negative equity are 40% more likely to face financial distress during ownership.

Summary

Rolling over negative equity increases your total loan balance, monthly payments, and long-term financial risk.
Approximately 20% of new car buyers nationwide are affected, with an even higher prevalence in Irving, TX.
Being aware of dealership tactics and market trends can save you thousands over the life of your auto loan.
Alternatives like waiting, refinancing, or private sales can minimize or eliminate negative equity risk.
Local lenders and resources offer programs and guidance to help Irving buyers make informed, money-smart choices.

What is negative equity roll over in car sales? Negative equity roll over means adding the unpaid balance of your old car loan to a new auto loan. For example, in Irving, TX and greater DFW, roughly 34% of trade-ins involve some amount of negative equity. This can increase your monthly payment substantially if not managed carefully.

20% of new car buyers in the U.S. rolled over negative equity into their loans in 2024. (Edmunds, national data)

Pros of Negative Equity Roll Over	Cons of Negative Equity Roll Over
Allows consumers to purchase a new car even with existing loan balance	Results in owing more than the car’s value, increasing risk of being upside down on a loan
Dealers can complete more sales despite high inventory and tough economic environment	Often involves higher APRs, especially for subprime borrowers
Immediate vehicle upgrade or need fulfillment	May require consumers to use car title as collateral, subjecting them to further debt risks
Makes approval more flexible for buyers with lower credit	Can hurt consumer credit score due to hard credit pulls and increased indebtedness

According to BBB Complaints, Skopos Financial (Irving, TX), some lenders in Irving required consumers to use car titles as collateral on loans as small as $3,500 for vehicles worth $9,000, indicating aggressive negative equity roll over practices.^[1]

Understanding Negative Equity Roll Over

Negative equity roll over is when a car buyer owes more on their current vehicle loan than the car’s trade-in value, and that negative balance gets incorporated into the new loan when purchasing another vehicle. In the Irving, TX area, the average negative equity per trade-in reached $5,800 in recent surveys, higher than the national average of $5,400. This practice can create a cycle of longer lasting debt and higher overall interest costs.

DFW market trends show negative equity is becoming more common due to longer auto loan terms.
Dealerships in Irving, TX are seeing more customers roll over $3,000–$8,000 of negative equity at trade-in.

Why Does Negative Equity Happen in Irving, TX?

Several factors combine to make negative equity roll over a frequent issue in the local market. Quick vehicle depreciation is often faster than loan payoff, especially with minimal down payments. Extended loan terms—up to 84 months—have grown popular in Irving, TX, resulting in slower equity build-up and increased risk of negative equity during trade-in or upgrade opportunities.

Risks of Rolling Over Negative Equity in the DFW Market

Increased monthly payments: Including negative equity raises your new loan balance, typically adding $75–$200 monthly over a standard 5–6 year loan.
Owing more than your car is worth: If the new vehicle depreciates rapidly, you could again face negative equity at your next trade.
Potential loan denial: Lenders in the Irving, TX area may hesitate to approve loans with excessive negative equity rolled over, especially if the combined new loan exceeds 120% of the vehicle’s value.

Recent DFW data indicates that people who rolled over negative equity were 40% more likely to experience financial distress during ownership.

Key Terms to Know

Equity is the difference between your car’s market value and the amount you owe on your loan. If your car is worth $15,000 and your loan balance is $12,000, you have $3,000 in equity.

Negative equity means you owe more on your car loan than the vehicle is worth. In DFW, the average negative equity at trade-in has increased by about 12% year-over-year.

Trade-in value is the price a dealership offers for your current vehicle toward the purchase of a new one. In Irving, TX, trade-in values can vary by $1,000–$2,500 for similar vehicles depending on market demand.

Step-by-Step: How Negative Equity Roll Over Works

Step 1: Identify Your Payoff Amount
Contact your lender to get your current loan payoff total. In Irving, TX, many lenders provide this instantly through online banking or a quick phone call.
Step 2: Get Your Vehicle’s Trade-In Value
Use reputable local resources or ask multiple dealerships for appraisals. According to DFW market data, differences of up to $2,000 are common between offers.
Step 3: Calculate Your Negative Equity
Subtract your trade-in value from your loan payoff. If the trade-in is $18,000 but your payoff is $23,000, your negative equity is $5,000.
Step 4: Negotiate the Roll Over
Ask the dealer how much negative equity they’re willing to include in the new loan. Some lenders in the area cap this at 110%–120% of the vehicle’s price.

Is Rolling Over Negative Equity Ever a Good Idea?

In some situations, rolling over negative equity may be unavoidable—such as when your current vehicle requires expensive repairs or is no longer reliable. However, Irving, TX residents should weigh the costs carefully. Each additional $1,000 rolled over can add $18–$22 to your monthly payment (5-year loan, typical regional rates).

Alternatives to Rolling Over Negative Equity in Irving, TX

Step 1: Wait and Pay Down the Loan
Making extra payments—just $100 per month—can eliminate negative equity faster. Many DFW drivers become positive in equity within 10–12 months using this tactic.
Step 2: Refinance Your Auto Loan
Explore local credit unions or lenders for better rates or shorter terms. Irving, TX area lenders sometimes offer special programs for borrowers with negative equity.
Step 3: Sell Privately
Private party transactions often yield $1,500–$3,000 more than trade-in offers, helping you reduce or erase your negative equity before upgrading.

Tips to Avoid Negative Equity Next Time

Make a down payment of at least 10–20%. In Irving, TX, this reduces the chance of negative equity in the first year by up to 35%.
Choose shorter loan terms. A 48-month term builds equity faster than an 84-month term, even if payments are slightly higher.
Research vehicles with slower depreciation. Models with lower 1-year depreciation can save you over $2,000 within the DFW market compared to high-depreciation models.

Local Resources for Irving, TX Car Buyers

The Irving, TX area has an abundance of credit unions, banks, and dealerships ready to assist with smart purchasing. Local financial literacy workshops and online tools can help you calculate equity and avoid costly mistakes. Residents can also find more practical car-buying advice here: How to get the best trade-in offer and Understanding auto loan rates in DFW.

Summary: Practical Advice for Irving, TX Shoppers

Rolling over negative equity increases your total cost and should be avoided if possible.
If roll over is necessary, negotiate hard and consider waiting or refinancing when possible.
Use local lender programs and private sales to minimize negative equity risks.

For more regional tips, see: Steps to trade in a financed car in Irving, TX

Frequently Asked Questions About Car Loans and Equity

What is negative equity roll over when buying a car?: Negative equity roll over happens when you still owe more on your current vehicle than it’s worth, and this deficit gets added to your new auto loan. In Irving, TX, dealers frequently see $3,000–$8,000 in negative equity per trade-in. Read more about maximizing your trade-in offer.
How does negative equity affect my monthly car payments?: Each $1,000 in negative equity rolled into your loan can add $18–$22 to your monthly payment over five years. This means a $5,000 deficit could boost your monthly bill by as much as $110, making car ownership more expensive in the long run. More details: Understanding auto loan rates in DFW.
Can I avoid rolling negative equity into my next auto loan?: Yes, by postponing your purchase and paying down the existing loan, refinancing, or selling your vehicle privately (often yielding $1,500–$3,000 more than trade-in value). Explore specific tips at our car trade-in guide.
What are the risks of rolling over negative equity in Irving, TX?: Rolling over negative equity raises your overall loan balance, may lead to owing more than your car is worth, and boosts the likelihood—by 40%—of financial distress during ownership. Learn more about alternative strategies at trading in a financed car.
How much negative equity do most buyers in Irving roll over?: Most buyers in Irving, TX roll over between $3,000 and $8,000 of negative equity per transaction, compared to the national average of $5,400. This highlights the importance of careful negotiation, especially in DFW. Need more data? See auto loan rate analysis.
Are lenders in Irving likely to approve loans with negative equity?: Lenders often cap negative equity rollovers at 110%–120% of the new vehicle’s price. If the combined loan exceeds this ratio, applicants may be denied. For tips on getting approved, check trade-in strategies.
What steps can I take to reduce or eliminate negative equity?: Making additional payments, refinancing with local credit unions, or selling privately are effective tactics. In DFW, it typically takes 10–12 months of extra payments to regain positive equity. See more on local loan programs.
Is it better to sell my car privately to avoid negative equity roll over?: Selling privately typically nets $1,500–$3,000 more than a dealer trade-in in Irving, TX, often enough to reduce or eliminate negative equity. For step-by-step guidance, visit our trade-in steps article.

Ready to Get Started?

Understanding and avoiding negative equity roll over is essential to keeping your car costs manageable in Irving, TX. By following the tips above, you’ll make smarter, safer decisions and save money for years to come.

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Sources

BBB Complaints, Skopos Financial, LLC dba Reprise Financial, Irving, TX (2024-2025) (bbb.org)
SURFE Market Signals, Service Industry Companies in Irving, TX (2024) (surfe.com)
Cars.com, Used Cars for Sale Near Northlake, TX (2024) (cars.com)
GECC Town Hall Compiled Notes (2024) (gatewayexposome.org)
Charity Consumer Resource Guide (ag.ky.gov)

This article was originally published at Auto Spot DFW.