Quote:
Originally Posted by feh
You're combining the asset with the liability associated with it. You need to keep them separate.
The car/house is still an asset. Anything that has value (can be sold) is an asset. The loan that needs to be repaid is a separate entity.
The fact that I may owe more on the car/home than what it's worth does not prevent me from selling the car/home and thus realizing its value.
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True. I guess I'm forgetting my basic accounting. The value of the car would go on one side of the balance sheet. The amount owed on the loan would go on the other side. So yes, the car would still be an asset.
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