While it may not be ideal to incur new debt while involved in a Chapter 13 repayment plan, sometimes it is necessary. For example, if you require regular access to reliable transportation, you may have to purchase a car. If you do need to get financing for a vehicle purchase while in the middle of Chapter 13 bankruptcy, there is a procedure that you must follow.
Buying a car is a basic need in today’s times. If you’re part of the general workforce or have a family, a car is a necessity. For car buyers who have gone through or are currently experiencing a bankruptcy, these needs are no different. However, your credit will be negatively affected. Many car dealerships will have difficulty getting you approved for a loan, if they can at all. With that said, there are some differences and there are options for you.
After going through a bankruptcy, you may be wondering if buying a new car will ever be possible. The good news is that bad credit isn’t forever, and full recovery from either a Chapter 7 or a Chapter 13 bankruptcy is entirely common.
You have determined that bankruptcy may be the only way to handle your enormous debt, but you don’t think that you have the available cash to pay the filing fees or to retain legal council. Luckily, there may still be a solution that will allow you to obtain the services and protection that you need.
Before your Chapter 13, you probably enjoyed all the convenience that car buyers with good credit did. You were able to walk into any dealership and have the deal done in a matter of hours, or you were able to take your time and shop around. Of course, all of that changed when times got tough, and left your credit in a crippling state, which left you no other option than to file for Chapter 13 Bankruptcy. Although you have reduced the amount of debt that you owe to your creditors, you are on a strict budget that leaves little to no room for additional expenses. What happens when you need a new vehicle? The car buying process is much more difficult, because you will need to not only work out terms with the dealer, but also ensure that whatever agreement you come to is also good with your bankruptcy trustee.
Even if your debt seems insurmountable, you may not yet be at the point where bankruptcy is your only viable option. Depending on the severity of your situation, their may be alternate measures that you can take.
How do you know when it may be time to file for bankruptcy? While no one wants to think that bankruptcy might happen to them, you just never know what life may bring. Often, bankruptcy can be the only way to turn things around financially, and the quickest way to a fresh start.