It feels like a no-win situation. You need dependable transportation to get to work. Without your work, there is no paycheck. Without money, it is impossible to get back on your feet after a bankruptcy. So, you need dependable transportation. If you feel like you are running in circles on this issue, it is because you don’t know what your options are. Many people see bankruptcy as an ending. In fact, bankruptcy can mean a new beginning for many people. There is a common misconception that it is impossible to get an auto loan after bankruptcy at least for many years. You may need a little help connecting with a lender and a dealer, but it not as difficult as you think.
Getting Your Life Back After Bankruptcy
Did you know that getting a car loan is a great way to recover your credit after a bankruptcy? Backruptcy auto loans are available to those with all types of credit histories. Of course, the most favorable terms are only available to those with the best credit. However, reasonable terms are available to those who have the means and desire to get back on their feet. Make your payments on time and watch your credit score start to climb again. That said, do your homework. Just as your background will be checked, make sure that you know the reputation and history of the organization promising you that you will be approved for a bankruptcy auto loan. Many will lead you to believe your only choice is to pay a sky high rate with terms that make the payments almost impossible.
Getting Strong
We all know how a bankruptcy happens. At some point, there just isn’t enough money to pay off debt. If the situation was caused by the unexpected loss of a job or the death of an income earning spouse with no life insurance, we may feel helpless. If we’ve come to this situation by our own poor choices, there is often a lot of shame involved in asking for a loan. The person you meet with to discuss how to qualify for a loan should be sensitive to your circumstances. If you feel as though you are being taken advantage of, you probably are and should feel good about walking away. At the very least, feel good about getting second and third opinions. Once you file for a Chapter 7 bankruptcy, you may actually see offers for auto loans. This is because dealers know that you cannot file again for 8 years. With most auto loans for bankruptcy for terms of 6 years or less, the risk that they will not get paid is reduced.
Getting Qualified
Not everyone who has experienced a bankruptcy will qualify for an auto loan. However, if you can show enough income to make the payments in addition to covering your living expenses, haven’t experienced multiple bankruptcies and have your Chapter 7 or Chapter 13 bankruptcy far enough along through the process, you may very well qualify. Whether or not you qualify right away for the kind of loan you need, you can start building your credit back immediately by setting up a budget and sticking to it. Request your credit report from all 3 bureaus, Equifax, Transunion and TRW. Check it for accuracy and begin correcting any errors. There are professional services and agencies that can assist you with legally correcting your credit report.
Once you have a correct credit report work with a professional who can help you determine how much car you can afford. You might not buy your dream car. However, if you can keep your tastes in line with your budget the dream of rebuilding a solid credit history and having dependable and safe transportation can be yours.
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