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Getting a Car Loan After Bankruptcy Discharge

If you have previously filed for bankruptcy, you probably know that getting a car loan is very difficult, if not impossible. However, in recent years, a lot of lending companies have been more than willing to offer car loans to individuals who have been discharged from bankruptcy. While this is great news for those who have been through the bankruptcy process, it is important to know that there are still a lot of things that you need to consider before you decide to take out a car loan.
In this article, we will go over the basics of applying for a car loan after bankruptcy discharge to help you make the best decision for your financial situation.

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Written by: Pig Daddy

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Tips to Increase Your Chances of Getting a Car Loan After Bankruptcy Discharge

 

After bankruptcy, a borrower’s credit score is going to be extremely low. If you have had your bankruptcy discharged, your credit rating will take a long time to recover. In some cases, it may take a couple of years before your credit score will return to its pre-bankruptcy levels.

If you are planning on getting a car loan in the near future, there are a few things that you can do to increase your chances of getting approved for a car loan.

 

Save Up for More Down Payment

A bigger down payment means you’re more likely to be approved for a car loan. This will make your application look less risky to the lender and will go a long way in helping you obtain a more affordable loan.

 

Rebuild Your Credit Score

The best way to get a good credit score is to build up as much positive credit history as possible. The more debts you pay off, the more positive history you will have. This will make your credit score rise and will make it easier for you to get approved for a car loan after bankruptcy discharge.

 

Do Your Research

Make sure that you do your research about the lending company that you want to work with. There are loan providers that specifically offer car loans to those with bankruptcy discharge or bad credit.

 

Lending Companies That Offer Car Loans After Bankruptcy Discharge

 

There are a lot of non-traditional lenders in Canada that offer car loans to individuals with bankruptcy discharge. Here are a few of the more popular ones:

 

401 Auto RV

401 Auto RV is an auto financing company that offers car loans ranging from $5,000 to $50,000 with a loan repayment term between 12 months to 96 months. Their interest rate starts at 4%.

APPLY NOW

Auto Park

Auto Park is an Ontario-based auto financing company that offers car loans of up to $60,000 with interest rates that can go up to 29%. They have a loan repayment term of 12 months to 96 months.

APPLY NOW

Frequently asked questions

What are the drawbacks of getting a car loan after getting discharged from bankruptcy?

The main drawback of getting a car loan after bankruptcy discharge is that the interest rate and monthly fees can be very high. Because of your not-so-stellar financial history, lenders will try to make as much money as possible off of you by charging you higher interest rates.

What can you do to avoid bankruptcy?

Avoid bankruptcy by planning ahead and being financially responsible. Make sure that you are paying your bills on time and that you have a budget in place. Live within your means and avoid taking on more debt than you can handle. 

Can I get a car loan after bankruptcy discharge if I don't have a job?

You need to have a steady source of income to qualify for a car loan after bankruptcy discharge. This means that you need to have a job to demonstrate your capacity to pay back the loan. Lenders are more discerning about those who have been discharged from bankruptcy.

Conclusion

 

Getting a car loan after bankruptcy discharge can be a great way to get a fresh start in life. However, you need to become more financially responsible and make sure that you are in a position to pay back the loan. This time, manage your finances wisely and make sure that you don’t fall into the same financial hole again.

 

Pig Daddy

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