Securing an Auto Loan After Bankruptcy
Filing for bankruptcy can make it difficult to secure auto financing, but there are still ways to get approved. Bankruptcy shouldn't stop you from striving for financial wellness. There are now several options for those who have filed for bankruptcy to get auto loans. You may qualify for lending institution programs, special financing, and credit amnesty programs. To find a dealer near you that offers Bankruptcy auto financing and get pre-qualified online.
Lower Credit: Bankruptcy undeniably affects your credit score, making you a less attractive borrower to many lenders. However, options exist for those who have filed for bankruptcy to get approved for auto loans.
Limited Options: You may be limited in the amount you can borrow, how long you can borrow it, and from whom you can borrow, You will want to consider subprime lenders or try to secure a pre-approval.
Stricter Qualifications: You may be required to make a down payment or use a cosigner to get approved. In addition, you will likely have to provide extra documentation such as proof of income and proof of residence.
How Long After Bankruptcy Can You Get an Auto Loan?
The timeline for obtaining an auto loan after bankruptcy varies based on several factors, including the type of bankruptcy filed and your personal financial recovery efforts.
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Chapter 7 Bankruptcy: You might be able to qualify for an auto loan as soon as your bankruptcy is discharged, which typically takes about 4 to 6 months after filing. However, it may be challenging to find favorable terms immediately.
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Chapter 13 Bankruptcy: Since this involves a repayment plan, you may need to obtain permission from the bankruptcy court to take on new debt. This can be possible during the repayment period, which lasts 3 to 5 years, but it depends on your specific circumstances and the court's approval.