Bankruptcy is a stage to make a fresh start to one’s finances. Often, when starting a new phase after bankruptcy, making a car purchase is a necessity. You can get a car loan while in bankruptcy or a little moment after filing. Lenders, Like Car Loans of America, are aware of your condition and will be willing to consider your loan application. With Car Loans of America, you can obtain an auto loan in bankruptcy quickly with less hassle!
As long as you’re educated on bankruptcy auto loans, the overall subject, and solid financial stability, then you should have no problem! Read more about how you can obtain an auto loan in bankruptcy or bankrupt car finance:
What is Bankruptcy? Can You Get Auto Loans while in Bankruptcy?
How do you get a car loan in bankruptcy? An auto loan with open Chapter 7 implies that your non-exempt asset as a debtor is liquidated to offset your debt. It takes between four to six months to complete the process of filing and erasing your debt after which the bankruptcy will be discharged. In this period, creditors will witness a 341 hearing of your case. There is a possibility of getting a vehicle loan during chapter 7 bankruptcy; however, as a consumer? You will have a better chance of having your loan approved and most likely with better terms if you apply after the discharge of your bankruptcy. This will strengthen your chances of approval for a bankruptcy automobile loan and broaden your bankruptcy auto finance options.
Sickness, job loss, divorce or even foreclosure. Almost everyone out there can and will experience one of these problems at some point in their life. During these unfortunate situations, it’s a known fact that debt can pile up quickly, placing individuals or families in a tough financial position. And, when it comes to bankrupt car finance, consumers in such a scenario are placed in a tough position.
With no safety net, it’s extremely difficult to get back on your feet and bounce back. Bankruptcy is a court proceeding where court trustees and a judge examine the assets and liabilities of individuals or businesses who can’t afford to pay their bills.
They then decide whether to discharge, or leave, those debts so the individual or business is no longer legally required to pay them. The primary reason for declaring bankruptcy is to begin and start all over again with a clean slate debt-free.
Typically, bankruptcy falls under two types:
Why Were Bankruptcy Laws Created?
Bankruptcy laws were created and written to give people who have a financial collapse the chance to begin fresh and start over. It could be several scenarios; from bad decisions to purely bad luck. Lawmakers saw that in a capitalistic economy, consumers and businesses that might have failed, deserve and need a second chance to get back on track financially.
Bankruptcy provides a solid solution by providing people with substantial debts the chance to get out of debt all while treating creditors fairly. Once completed, the debtor (or person filing for bankruptcy), more often than not will feel relief that comes with a clean financial plate and a fresh, new start. All without the looming burden of unpaid bills!
Why Do People File for Bankruptcy?
The average amount of debt for every day working class Americans continuously rises significantly each year. At this time, there are now over 1.5 trillion dollars in outstanding loan debt within the country! That includes auto loans, student loans, and so on. With staggering debt numbers lingering over a vast number of Americans, people typically tend to seek and turn to drastic measures. Getting car loans while in bankruptcy or auto loans after bankruptcy is possible, so read on!
For most consumers, it’s highly advised you wait until your bankruptcy has aged and your credit score has improved. In doing so, you broaden your chances of receiving an auto loan after bankruptcy! Remember, depending on the type of bankruptcy filed, it can negatively impact your credit score for years.
Bankruptcy Auto Loans And Your Approval Chances
Even so, filing for and seeking bankruptcy car loans doesn’t mean you won’t get approved! Your credit score can still improve slightly after bankruptcy. That is, of course, as long as your on top of your auto loan after bankruptcy payments on time. And, payments discharged. One study through Princeton University found that people in Chapter 13 bankruptcy saw an increase in credit scores by 17 points over the first five years after filing for bankruptcy. If you’re in a spot where you’re completely behind in payments and have no way out, bankruptcy is often the last resort. Especially so when seeking bankrupt car finance options.
And, you might be able to increase your credit score during bankruptcy by tackling and making the required payments on as many outstanding debts you currently have. This is regardless of whether or not you have a payment plan set in place. The faster you take these steps to improved your credit score, the sooner you’ll be able to obtain an auto loan in bankruptcy or a car loan after bankruptcy.
Chapter 7 Bankruptcy
In return for eliminating qualifying debt, individuals must agree that the trustee can take and liquidate some property of his or hers to pay back the debts incurred. You can, however, keep the exempt property protected under state law.
Bankruptcy Car Loan Reaffirming Under Chapter 7
In case of filing for bankruptcy while with an outstanding auto loan, you may like to keep your car and a usual approach is to reaffirm the loan. A car loan reaffirming is a legal agreement. This is where the bankruptcy individuals continually pay the debt without having it subjected to discharge via the bankruptcy proceedings.
A car loan reaffirmation allows you to retain an interest rate. And, it subjects you to pay lower than the available auto loans after bankruptcy. This is because the effect of bankruptcy is still pronounced in your credit report.
You will be subjected to bearing the consequences when you miss a repayment on a reaffirmed loan. This is done after your bankruptcy has been discharged. As a borrower, you will be responsible for any deficit balance and auction fee should a lender repossess and resell the vehicle.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy reorganizes debt for those with high-income earnings. You must pay creditors the value of any nonexempt assets as part of a 3 to a 5-year monthly payment plan. Also, you’ll have to include any additional discretionary income as determined by the bankruptcy car loan and car financing after bankruptcy rules.
Obtain an Auto Loan in Bankruptcy Through Car Loans of America
For debtors who have agreed to repay parts or all of their debt with three to five years, chapter 13 auto loan is the most suitable. Chapter 13 Bankruptcy ensures that you still have the possession of your assets. Of which, you should have forfeited to the bankruptcy process.
Are you a bankruptcy car loan consumer with bad credit and haven’t got permission from a court-appointed a trustee? You can apply for bankrupt car finance loan seven while chapter 13 bankruptcy is still on. Some bankruptcy car loans and bankrupt car finance lenders are open to considering your bankruptcy car loan application.
Proceeding with an Auto Loan in Bankruptcy And Obtaining Bankrupt Car Finance
If eventually approved for a post-bankruptcy auto loan? As per the financial trouble you have undergone, you will most likely receive a higher interest. And, worse financial terms compared to someone with a better credit report! You may be required to pay a reasonable down payment on your bankruptcy car loan to be taken seriously.
Read more about bankrupt car finance and auto loans.
Experience Car Ownership Regardless of Your Financial Situation with a Bankruptcy Car Loan
Irrespective of your financial situation, you can enjoy the ownership of a car through online lenders as they are willing to partner you in reestablishing a better financial condition for yourself. To obtain an auto loan in bankruptcy might seem like a chore. And it is, specifically when you’re goal is to buy a car.
But it isn’t! Find the auto lenders best situated to your cause! And, available to handle your case with a great deal of professionalism. We’ll help you obtain an auto loan in bankruptcy after absolutely no time at all. Contact us today to receive car financing after bankruptcy at a rate you can afford!