How to Determine the Equity in a Car

If you have equity in your car, that means it is worth more than you still owe. Equity in a car is calculated by subtracting the amount you owe to the lender from the actual value of the car.

Obtain Your Car Loan Balance

Unless you get a monthly statement, you will need to contact your lender to get a current payout amount on your loan. Ask if there are any penalties for paying off a loan ahead of schedule and include that number in your payout amount. If you own your vehicle outright, this step will not apply.

Determine the Car's Actual Value

Calculating your vehicle's value can be a little tricky, as the current automotive market fluctuates greatly seasonally and even daily. There are two common ways of determining actual values on cars.

Dealership Appraisal

An appraisal completed at a reputable dealership can be the easiest and most accurate way to determine your vehicle's market value. This holds especially true if it is the dealership from which you will be purchasing your new vehicle, as it has a vested interest in satisfying you.

A sales manager will inspect your vehicle's condition and compare it with other similar vehicles on the market to determine its value. The dealership may provide you with a market value but also may provide a trade-in value. The trade-in value is the car's value before reconditioning costs and will usually be considerably less.

Online Appraisal Tool

Online appraisal tools such as Kelley Blue Book will provide market values for your vehicle.

  1. Navigate to Kelley Blue Book. Select "_Check My Car's Value."_
  2. Enter your vehicle's information as accurately as possible. When selecting options, don't leave anything out and don't add anything extra. 
  3. Indicate whether you would like the trade-in value or the private-sale value. 
  4. Determine your vehicle's condition. When selecting the vehicle's condition, be realistic. The dents and scratches that don't bother you still factor into the overall condition and value of your vehicle.
  5. Click on "Get Blue Book Value." The values presented will be an excellent idea of what your vehicle is actually worth.


  • The appraised value is the figure to use when determining the asking price for your vehicle. Calculate your vehicle's equity

Calculate your Vehicle's Equity

Use the appraisal value you received and subtract what you still owe the lender, including all loan payout fees if applicable. This is the equity that you have in your vehicle.

For example, calculate the equity on a 2013 Dodge Charger SXT with 33,000 miles in good condition. Suppose there is an outstanding car loan of $10,500 plus a $150 payout fee. Kelley Blue Book values the car, in good condition, at $20,376. When you do the math, the equity in the Dodge Charger is $9,726.


  • It is possible to have negative equity if you owe more on your car loan than your vehicle is worth.