Auto loans after filing bankruptcy.
As a bankruptcy practitioner for nearly 30 years, I know how important it is for you to be able to get an automobile. For most people, it is not practical to buy a car for cash so you need to get an automobile loan to get a decent car. If you are a candidate for bankruptcy, meaning that your finances are in distress and you have more bills than you can pay, you are probably not going to be able to get an automobile loan before filing bankruptcy easily. It is possible, but you will probably pay a higher price. Higher interest rates are the norm for people who have poor credit.
The good news is that there is a strategy that you can follow to get an automobile loan after filing bankruptcy in interest rate that is reasonable. There are several strategies that I have used over the years to help my clients get automobile loans after filing bankruptcy.
The most common strategy is to file bankruptcy and get the automobile loan after filing bankruptcy.
Actually, you will probably get two loans, this is a two-step process. Step one is to file bankruptcy. Once you file bankruptcy, most if not all your debts will be wiped out. Of course, the bankruptcy will, initially, lower your credit score. For most of my clients, credit scores will begin to increase very quickly because they will follow my credit score improvement program.
Immediately after filing bankruptcy, your debts are discharged, so you should be able to get a car loan without a tremendous amount of difficulty. However, remember that if you are getting a car loan immediately after filing bankruptcy, there will not have yet been enough time to improve your credit score significantly. Therefore, you will end up paying a higher interest rate.
So, what you’ll want to do is to purchase an automobile for the lowest possible purchase price if you can. Do not go too low in the purchase price or you will end up paying more in maintenance than you will pay for your car payments. Also, do not worry about getting a really nice car – the car that you would prefer to drive – because this is a just a temporary car. Temporary transportation until you can improve your score enough to get the car you really want.
After you have filed your bankruptcy and purchased your first car with an automobile loan that is really not ideal, you will begin to rebuild your credit. I have a step-by-step program that I use to help my clients to quickly rebuild credit. The program works so well that generally we see a credit score of 650 or higher within one year.
After you’ve rebuilt your credit to the point where you can qualify for a good interest rate on car loan, you will trade in the car that you bought right after filing bankruptcy and you will get good automobile loan, and good automobile, at a decent interest rate – typically within one year of your bankruptcy discharge.
By following this strategy, you can get automobile loan after filing your bankruptcy, use our program to rebuild your credit after the bankruptcy, and then get another automobile loan within a year and a decent interest rate. This is a proven technique and really does work well.