A car loan is one of the easiest types of secured loans to get after bankruptcy. Take charge of your finances and negotiate the best deal you can. You can choose your lender because there are so many ways to borrow money. Start by making your credit report look better. Then, find a way to pay for the car before you go shopping. You'll get a good rate, and you might even be able to get an even better price on your new car.
Be proactive about getting money.
Don't fall for financing from the dealership that is meant for people with bad credit. Often, you'll be stuck with a loan with a high interest rate and a car that costs a lot. Instead, do what you can to get your financing set up before you go car shopping.
This gives you the most choices when it comes to where you want to buy a car. And because you have "cash," you can get a better deal. They will never find out that you have filed for bankruptcy before.
Get your credit report in order.
Before you get a car loan, make sure that your bankruptcy has been fully paid off. You can get a free copy of your report online to make sure that all accounts that should have been closed have been. Make sure your payment history is correct as well.
You might also want to look at your FICO score when you look at your credit report. You can expect your score to be in the low 500s if you just went bankrupt. But after two years, you can have a score of more than 650 and be eligible for market rates.
Boost the number of qualifications
Even if you have filed for bankruptcy, there are several ways to lower your rates. A 20% down payment or more is a good place to start, as is having little debt and money in the bank.
You can lower your rates even more by being picky about your terms. Most of the time, adjustable rates are lower than fixed rates. A loan for three years will also have lower interest rates than a loan for five years.
Find the right lender.
You can also save money on loan costs if you look for the right lender. Quotes for loans can be used to compare rates and fees. Broker sites for car loans can help you compare different offers side by side.
