A content creator who gives car-related advice went viral on TikTok after revealing how to trade in a car that has negative equity. And his advice appears sound. At least one woman made a series of videos explaining how this trick saved her $15,000.
The counsel came from Russ (@russflipswhips), whose video on the matter has amassed more than 2.5 million views. “If you have a car with a good bit of negative equity and you want to get out of it,” he said, “let me show you exactly how to do that.”
Negative equity is when the amount of money you owe on a house or car is more than what the asset is actually worth.
Firstly, Russ said, buyers need to have money that they’re prepared to put down on a new car. “A deal never gets done unless you have a little bit of money down,” he warned. Next, he advised prospective buyers to look at new cars—specifically, those from the previous year. These cars, he said, will have “amazing discounts and a ton of rebates.”
“But here’s the secret,” Russ said. “You want to lease the car, not buy it.”
Russ said it’s important to lease these vehicles because doing so offers more flexibility. “When the lease term ends, you can walk away from it,” he said. Russ showed viewers two 2023 car models; he said that both “lease extremely well.”
“If you have $10,000 of negative equity, it’s basically like you’re buying this car for sticker price,” he said. “And the bank will approve it… New cars are the best because you can bury that negative equity into the deal.”
This advice has been confirmed elsewhere, too. Trading in your current car for a leased one, according to one website, not only gets buyers out of the red on their investment, but can help them rebuild their credit.
According to one content creator, it does. One woman, Sam (@_loving.my.life_) said that Russ’ advice saved her and her family $15,000. In a video, which has nearly 32,000 views, she explained how.
“This right here is why we cannot get rid of TikTok,” Sam said.
In short, Sam said that she owed $51,000 on her 2020 Kia Telluride. After watching Russ’s video, though, she traded it in for a 2024 Kia EV6 that she said costs much less: $37,000, to be exact.
“This Telluride, if you were to look at it now, you’d get about $25,000 to $27,000 for,” Sam said. “That’s how negative equity works.”
Sam said she owed $900/month on the Telluride, which she drove for two years. She said that if she were to continue making payments for an additional three years, she’d have spent $32,400. So, in the long-run, she’d end up paying more for the Telluride when, in the same timespan, she could have the EV6 almost completely paid off.
Sam admitted the downfall of leasing: she’d have no car in three years. But that was offset by what she believed were the positives of leasing an EV6.
“This worked for my family,” she said.
A handful of them were. In fact, some commenters admitted on Sam’s video that they’ve made similar moves—and have saved money in the process.
“I did the same with the EV6. Great deal,” one woman said. “Done in three years.”
“This is 100% the way to get out of neg equity IF YOU HAVE THE CREDIT TO DO SO,” another added.
It’s true that having a high credit score is key when buying or leasing a car, which a handful of viewers noted. But others remained stuck on the fact that Sam said she made monthly payments of $900 on her Telluride.
“50k for a Kia is crazy,” one person commented.
@russflipswhips This is the best way to trade a car with negative equity #carsales #cardealership #carsalesman ♬ original sound - RussFlipsWhips
“I don’t know if my mouth would allow me to say yes to a 900 dollar car payment,” another admitted. “I hate my 365 car payment now.”
The Daily Dot has reached out to both Russ and Sam via TikTok comment.
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The post ‘50k for a Kia is crazy’: Driver says this 1 tip from car expert saved her $15,000 from car with negative equity appeared first on The Daily Dot.
