In general, this hasn't been true for a long time. If people consistently pay for their cars, lenders are willing to loan them far more than they (the lenders) could recover if repo were necessary. More than loan value, more than wholesale, more than retail, more than retail plus sales tax. They'll even do it for people who only pay more or less on time.
Sure, the owner can't sell the car outright, but because of the system above, if he's paid regularly, can trade it, even if he's buried. The lenders will help him get buried more.
The problem comes in when there's an involuntary outright sale, which is essentially the situation if the car is totalled. The insurance company is buying the car for its actual market value, which may be a lot less than what's owed. In that case, the lender might accept an exchange for a lien on a similar car which can be purchased for the insurance proceeds, the buyer retaining an amount owed higher than the car's value. OTOH, some insurance companies offer (for an additional premium) coverage that will pay the loan amount if greater than the value of the car. Where there's a demand, someone will step in and make money off it.
