Though the bankruptcy rate in America has dropped about 10 percent in the past year, it's still a fact that numerous folks still find themselves in the position to file for Chapter 7. But it's also true that those who file for bankruptcy still have to get on with their lives. Purchasing a car may be a big part of that reality, but getting a car without getting killed financially becomes more of a challenge as a result of being in bankruptcy. Here are some tips on how to go about getting a good car after filing.
Know Your Status
Once you've filed, that doesn't mean you're in the clear.
Many filers get advertising directed at them for new car loans. Though there's nothing wrong with talking to these lenders to see what kind of rate you could get if you're approved prior to your case being closed, you should be in no rush to sign anything. Because it's probably wiser to wait until your case is closed, consider finding alternate means of transportation including public and ride-sharing services.
Steer Clear of the Lure
There's a temptation to buy right away because it makes you feel "normal" again, but it's not wise to jump in head first after filing. Lenders are very aggressive in getting new or used car loans signed and they'll push you in the direction of painfully
Dealers will also try to lure you in by saying you can finance and buy the car right then and there. This essentially equates to high interest, long term payment plans and a large percentage down payment, upwards of 35%, and they might not just be new. Dealers may push you to buy a car that has high mileage and bad reliability. This is their way of cornering you into doing something that's going to be financially detrimental to you and may later lead to repossession if you can't make the payments, a huge dent in your quest to start fresh financially. Dealers aren't exactly out for your
Consider Used Via a Reputable Dealer
It's a good approach to
Again, if you can wait until after your case has been closed, you'll find better car-buying opportunities. Sure, your interest rate will be higher than customers with good credit, but likely not as astronomical as during the filing process. If you can make sure your financial affairs are in order first, it's also better for you. A history of regular payments and no new debts is key since lenders will focus on that, as well as past regular car and house payments.