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Car Loans After Bankruptcy - Tips To Getting Approved
By: Carrie Reeder
A car loans after a bankruptcy is one way to help build back your credit
history. In fact, once your bankruptcy closes, you can apply for a car loan the
next day. To get approved with the best rates for your car loan, follow these
tips.
Review Your Credit Report
Before you start applying for a car loan, check out your credit report and make
sure all your accounts are in order. It is not uncommon after a bankruptcy to
see open accounts that should be closed, which hurt your credit rating.
While looking at your credit report, consider adding a page explaining the
situation that resulted in your bankruptcy. If there were extenuating
circumstances, lenders may approve you for a better rate than under normal
conditions.
Plan Your Car Purchase
Before purchasing a vehicle, decide what you can afford in a monthly car loan
payment. This will help you decide which financing package is best for you. Both
the loan amount and length of payments will determine your monthly payments, so
there is flexibility in determining which vehicle you can afford to purchase.
Use A Car Loan Lender
Car loan lenders make their money by finding you a loan. Car loan lenders work
with several financing partners to back loans with all types of credit risk,
including bankruptcies.
Online car loan lenders deal with thousands of loans, and can usually find you a
better deal than your local car dealerships. Online car loan lenders will send
you a check when you are approved, basically making you a pre-approved car loan
buyer.
Explain Your Situation
Car loan applications will ask if you have ever declared bankruptcy and why.
This is your chance to explain what led up to the situation and what steps you
have taken to resolve your credit situation. Be sure to include improvements in
your financial history too.
Consider Refinancing
Once you are approved for a car loan, keep your eye on future refinancing. By
making regular payments on all your bills, in a year’s time you could qualify
for significantly lower interest rates. In three years, you can build your
credit score to near excellent and qualify for even lower rates.
About the Author:
Carrie Reeder is the owner of
www.abcloanguide.com, an informational
website about various types of loans. To view our list of recommended auto loan
companies online, visit this page:
www.abcloanguide.com/autoloans.shtml |
