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How to get a car loan after bankruptcy?

  1. Get your credit reports and credit scores
  2. Put together a down payment
  3. Shop around
  4. Avoid the worst loans
  5. Pay on time
  6. Refinance

Click here to Get Pre-approved 

  • Get your credit reports and credit scores
In the era of frequent identity theft, we should all check our credit reports and scores on a regular basis.
Check it every six months to make sure no errors have arisen. Automotive lenders are going to look
more closely at your history with automotive loans than at other details, so check to see what your
report says in advance of applying.
 
  • Put together a down payment
Try to operate on a cash-only basis for a year after a bankruptcy. A sizable down payment demonstrates
less risk for the lender. If you do default, they do have your vehicle as collateral. If your need for a
vehicle is more urgent than the cash you have on hand, trade in your current vehicle to loosen up extra
funds toward the down payment.
  • Shop around
Limit your car shopping to one day. It reduces the number of credit inquiries, too many of which can
impact your credit score. Gather your pay stubs and your printed credit report. Obtaining pre-approval
before you visit a dealership is also a terrific idea. If your bankruptcy was more recent, your loan rate
will likely be higher. But if you walk in with an existing deal in hand, many dealerships will try to match
  • Avoid the worst loans
Be very careful when choosing a lender. Too many individuals with poor credit history can become
victims of predatory loans. Watch out for hidden costs and make sure at the outset that the monthly
payments are comfortable for you. Defaulting too soon after a bankruptcy, your range of options is
narrow.
  • Pay on time
Regular car payments are an excellent way to rebuild credit with fair speed after a bankruptcy. If you're
on time each and every month, it raises your credit score more quickly than if you didn't borrow money
for a car.
  • Refinance
After six to twelve months of regular payments, examine your credit rating. There may already be visible
improvements to your score. You can then try to re-finance the loan to get a lower (and even more
manageable) interest rate. A lowered interest rate within that time frame is not guaranteed, of course.
Exercise caution and look forward to the eventual benefits of restored credit.
Q & A: 
 
  1. Can you buy a car if you file for bankruptcy? 
 
Filing for bankruptcy doesn't necessarily mean you'll never be able to get another car loan. Quite a few
lenders are amenable to working with individuals attempting to rebuild credit. Here are some steps to
follow so that your post-bankruptcy car loan application is more likely to be successful.
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