If you have filed for bankruptcy or are considering filing for bankruptcy, you may be under the impression that it’s impossible to ever get approved for a home or car loan, again. This is simply not true.
Below are six tips to help you buy a car after filing for Chapter 7 or Chapter 13 bankruptcy:
1. Get a copy of your credit report and credit score. Be prepared before you go to the dealership. Your credit report is available for free at AnnualCreditReport.com or Credit.com. The dealership will pay particular attention to your previous auto loans, so make sure you familiarize yourself with that information.
2. Start saving for a down payment. Most consumers’ cash flow improves after bankruptcy, so you can put some of that extra money towards your down payment. Remember that the larger the down payment, the less risky you look to the lender.
3. Shop around. Try to do your car shopping in one day to avoid having multiple pulls on your credit report. It is better to be preapproved before you visit the dealer, that way you have some leverage.
4. Avoid “buy here, pay here” dealers. Do not assume that dealers with the highest interest rates will be the only option for you. Some of these dealers do not have a great selection and you may end up with a car payment with a higher interest rate along with repair bills.
5. Pay on time. Chances are your credit score has taken a hit after filing for bankruptcy. Use your auto loan to help improve your scores by making your payments on time.
6. Refinance your car loan. If you have been making your car payments on time each month, you may be eligible to refinance your auto loan at a lower interest rate after six to 12 months.
Click here to read more on ways to purchase a car loan after filing for bankruptcy.
If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.