How To Get a Car Loan Post Bankruptcy?
To apply for a car loan is difficult especially if you have bad credit or have filed for bankruptcy.
As the famous Edward Abbey quote, ‘the longest journey begins with a single step, not with a turn of the ignition key’, remember that anyone who has ever filed for bankruptcy can apply for a new car loan at any time. The article highlights some important points that one must be aware of before applying for Poor Credit Car Loans post Bankruptcy.
Bankruptcy Status: The first thing before applying for a car loan post bankruptcy is to know your exact bankruptcy status. Individuals are allowed to file two types of bankruptcy: Chapter 7 and Chapter 13. Depending on your individual case a bankruptcy can either be discharged or dismissed. While a discharge basically means that your case has completed successfully a dismissal means that your entire bankruptcy case has been dismissed.
Being free from bankruptcy or a total discharge of bankruptcy means that you are now free to go in for any new credit loan or car loan. While Bankruptcy dismissal mostly happens in Chapter 13 fillings and if your case has been dismissed it would mean that any new application for any auto credit loan would be turned down.
Rebuild/Repair You Credit: After your bankruptcy has been successfully discharged the most important thing is to rebuild your credit ratings. Technically speaking one can apply for a car as soon as the bankruptcy closes. In fact getting a car loan approved post bankruptcy not only gets you the desired loan but also helps you to build back your credit history.
Rise… Gradually!: You can also start re-establishing your credit with a smaller loan first. Another way to get your auto loan approved post bankruptcy is to try and make a larger down payment for the vehicle thereby ensuring that the new lender is financing a smaller amount which has lesser risks involved. By making regular payments on all your bills and as your credit ratings improve, keep looking at cheaper options to Refinance your car after six to twelve months.
Reclaim your Credit: Remember that even after successful discharge, bankruptcy account reports will not be removed from your credit report. The new lenders for your auto loan will see your bankruptcy history. Most lenders basically would ask or need some sort of proof that you would pay off the loan. One of the ways is to apply for a secured card where your credit limit is determined by the balance in a special savings account you set up.
Choose the Appropriate Car Loan Lender: Getting hold of an experienced car loan lender is one the best things for anyone seeking loans post bankruptcy. Online car loan lenders deal with thousands of such loans, and can usually find you a better deal than your local dealers.
Though it is a bit difficult but not impossible if you try genuinely. Though gradually, the bad credit will get replace with good one every time you ensure that loans are taken to be repaid.Initially, it would be slow yet being persistent in your payments you can get your credit back.