When buying a car or any vehicle you should always be alert and make wise and smart moves. Especially after filing for bankruptcy. It is not the best time to buy a vehicle after filing for bankruptcy but it is not a bad thing to do as most of your previous debts would be cleared and you will have a fresh start. You can get a vehicle loan but at a much higher rate as your credit report shows that you are a higher credit risk. But before taking any loans, you will have to increase your credit score. There are various ways to increase your credit score by maybe being an authorized user or by re-affirming debts or even by taking secured credit cards and showing in your credit report that you are paying on time and can be reliable. The better your credit report is the better chances of you getting a better deal.
Here are some steps which will help you make a smart choice-
- When approaching a creditor, behave as if you have never filed for bankruptcy. But remind you, if they ask don’t lie. Every lender perceives bankruptcy in its way. Visit as many places as you can before finalizing anything or anyone as you will get different interest rates from everyone; choose the one you are more suitable with.
- Don’t take the decision hastily; never take the first offer you get as in most cases it is seen that the more you look into it and visit more lenders you will get a better deal to sign to. Just patiently wait and work smart and don’t get excited as soon as you get a deal.
- Choose a car that fits your needs rather than the looks. It should be a reasonable choice that may even be a used car in good condition that will help you travel from one place to another. If you have filed under chapter 13 bankruptcy which goes on up to five years, you might need to get your car approved by the bankruptcy trustee appointed for you. So it is very important that you choose a reasonable vehicle that is suitable for you rather than something that does not fit your needs.
- Don’t ever take the deals given by the buy – here – pay – here dealers as they too often charge you very high-interest rates as well as huge down payments. They take advantage of you as a lot of people think that after filing for bankruptcy they will not get loans and that is just a myth. Never sign a deal whit the dealers who take the money directly as most of the time they give you vehicles that have more than 100,000 miles on their odometers, which often leads to your car breaking down even before your debt is cleared.