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Who’s sorry now? That new car or truck looked great at the time and the dealership was all to happy to help you get yu out of your old wheels and into the new transportation, and the car smelled good.

But figures out revel that Americans are going deeper and deeper in debt for new vehicles. In October of 2007, the average amount financed hit $30,738, up $3,500 in just a year and nearly 40% in the last decade, according to the Federal Reserve data. More troubling, today’s average car owner owes $4,221 more than the vehicle is worth at the time it’s sold — up from $3,529 in 2002, according to industry analyst Edmunds.

An article on the LA Times presents yet another sad but true case of a transportation financing accident that can total a families financial health.

Jennifer and Bobby Post rolled over $9,500 of debt owed from their old trucks for a new Ford F-350 turbo diesel extended cab truck with extra testosterone on the side. We can only imagine what their new gas bills look like but it appears the Post’s shopped using their “what’s my monthly payment� hat on.

After handing over their 2001 Chevy Suburban to the car dealership and rolling away with the new Ford F-350 pickup truck they are now carrying around a $44,276 loan payable over seven years.

After a change in circumstances, the Post’s are now stuck in the truck, owing so much more than it’s worth. Being in debt like this is called being “upside down� and I’m sure that the Jennifer and Bobby are literally feeling like that now.

This cycle of rolling old debt into a new car loan is not new but with the current credit crunch on, people are going to find it either much more expensive or much harder to get out from all the negative equity they are lugging around.

The article in the Los Angles Times goes on to say:

Cindy Gerhardt has rolled over so much debt on successive vehicle purchases — five in three years — that she now owes almost $43,000 on two trucks worth no more than $29,000 and, she says, perhaps as little as $22,000.

Faced with car payments that exceed her monthly mortgage, she tried to trade in the pair for a single vehicle. But with so much unpaid principal on the vehicle loans, the only offer she got from the dealer was to trade in one truck on yet another new vehicle — and increase her debt by another $25,000.

“It’s our own fault that we traded in vehicles so many times, but we never thought it would get to this,” said Gerhardt, a secretary who lives with her husband and two children in Clinton, Okla. She recently tried to refinance her mortgage, she said, but was declined because her car payments were too high. “Not one dealer ever said this was a problem. Ever. I never had a dealership say no.”

Read the full story here.

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Steve

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