True, but if the car loan is 10% or less of your home equity you would still be “right-side-up”. Like any other big financial decision, you have to be prudent and weigh the risks of a housing market crash.
We’ve been through two housing crashes and our home has never lost more than 30% of it’s previous highest value. In both cases we still owed less than the value of the home. We thank God for that blessing.
You are correct that having a large sum of money available is tempting, but most folks who are bad at managing their money won’t have much equity in their home as they are prone to refinancing often and taking every cent of equity out.
I appreciate the advice.