Even though you’ve been through a recent bankruptcy, it doesn’t necessarily mean you need to put off buying a vehicle. In reality purchasing a car can actually build your credit score up quickly. By making timely monthly payments you are showing a positive loan payment history.
As long as you can show stable employment and income you should be able to purchase a car relatively easy. With the abundance of car loan choices today you should not have to worry that you can’t get a loan. Spend some time shopping around for the best interest rate available to you. The interest rate is determined by several factors such as credit rating and bankruptcy due to financial issues brought on by uncontrollable events.
Lenders focus on your prior history of making car and mortgage payments. If you’ve previously had a good track record paying car loans, you may very well be able finance your vehicle through a lender such as a credit union for a lower rate then what was offered to you through the dealership.
Your track record for paying on your current car will carry the most weight. They will look to see whether you’ve missed any payments on your current car, and if you have are you back on track now that you’ve completed your bankruptcy.
Since a Chapter 13 bankruptcy can take some time, it’s not unusual for a person involved to need a new car. In that case a bankruptcy trustee will need to approve the new auto loan the consumer wants to take on while in the midst of bankruptcy proceedings. Hence a trustee is more likely to approve a car loan of a moderate or lower priced vehicle rather than a luxury or expensive vehicle.
The longer you are out of bankruptcy the better your chances are for a lower interest rate. Even though you have been through bankruptcy you can still shop around for a better rate instead of just taking the first option offered to you.
The best part is because your vehicle serves as collateral for the loan, a car loan is one of the quickest credit builders after your bankruptcy is completed.
For a free consultation regarding bankruptcy matters contact We Legal, APC, Emilia McAfee, attorney at 951-268-1341 or toll free 877-674-1021. Building strong client relationships and providing dedicated professional service to the community.