Your post bankruptcy car loan options may be slightly more limited than those for individuals who have not gone through bankruptcy, but you are not completely out of luck. Getting an auto loan is actually a great way for you to build your credit back up following bankruptcy. Finding a lender for a bankruptcy car loan is not going to be impossible, or even nearly as difficult as you may think. Most post bankruptcy car loan options are available through online applications, making finding an auto loan easier than you may think.
Dress Up Your Credit
Dress your credit report up first before you seek out loan options. Most post bankruptcy auto loan applications will be improved, but it is still a good idea that you take steps to fix up your credit report before you fill out your application. One way for you to do this is to add a page of comments to your credit report, explaining the circumstances through which you were led to file for bankruptcy. You can achieve this by contacting all three credit bureaus and receiving your credit report information.
Obtain a Secured Credit Card
Obtain a secured credit card to build up your credit before applying for a post bankruptcy auto loan. These types of credit cards are readily available and can help you build up your credit without risk by way of placing a deposit on the card before you are allowed to use it. Run a small balance on this card and pay off more than the minimum balance every month to prove that you are capable of repaying credit obligations.
Determine What You Can Pay
When applying for an auto loan post bankruptcy, determine what amount you can pay every month. You are going to need to want to prepare a budget allowing you to know exactly what you can afford for your new automobile's payment. How long will you be paying for your new vehicle, and what will it take to pay the loan off on time? Bad credit car loans and post bankruptcy car loans may mean higher interest rates or higher monthly payments, so plan accordingly.
Shop around in order to find the best bankruptcy loan options. Once you have decided how much you will be able to afford when it comes to your auto loan, you should shop around not only to find out what type of auto loan you can get approved for but also what type of vehicle you want. Shop around online and in person, visiting online lenders and brick and mortar lenders so that you can get a full idea of the auto loan options available to you. In some cases, once approved for your post bankruptcy car loan, you can get the money you need in as little as 24 hours.
Post Bankruptcy Car Loan Options
Once you have the loan you need, you are free to negotiate for the vehicle of your dreams. Shopping smart is important, because this auto loan will help you to rebuild your credit following a bankruptcy on your credit report.
Related Questions and Answers
After Bankruptcy, How Soon After Applying for a Secured Credit Card can You Expect to Receive a Reasonably Rated Car Loan?
Applying for a secured credit card after a bankruptcy is a good start to rebuilding your credit rating. Rebuilding your credit score to a level where you qualify for a prime rate loan will take some time. It is best to allow one to three years to get your credit back up to a reasonable level. It is important to make all payments on time. Late or missed payments will have a detrimental effect on your credit rating. In addition to a secured credit card you should take on small amounts of other debt and monthly accounts. Utility bills in your name or a small loan that is paid on time will help your rating.