As someone who’s financially bankrupt, it can be difficult to know where to turn when you need to finance a vehicle. You may be wondering if you can even get a car after you’ve gone bankrupt. The good news is that it’s possible, but you have to use the right kind of lender for the job.
Special Financing for Bankrupts
In most cases, your bankruptcy must be discharged to get a car loan, especially if you filed for Chapter 7. Due to its three or five year time frame, it’s possible to get auto financing during an open Chapter 13 bankruptcy. But, you’ll have to follow specific procedures to do so. If your bankruptcy was dismissed, chances are you’re not going to be getting the financing you’re looking for – no matter what bankruptcy you filed.
By filing a Chapter 7 liquidation bankruptcy or a Chapter 13 repayment bankruptcy, your credit score shows the effects of the process with a lower score. Bankruptcy stays on your credit reports for a long time: seven years for a Chapter 13 and 10 years for a Chapter 7.
Even though this black mark follows you on your credit report, it loses its potency after a while, and doesn’t make as big an impact upon your credit as when it’s fresh. But, because it does show up and lowers your credit score, you usually need to work with a subprime lender to finance a vehicle. These lenders can only be found through special finance dealers.
Looking Beyond Your Credit
Subprime lenders have the ability to look beyond your credit and use other ways of approval to help you get the financing you need, which is why they’re the ideal lenders for bankrupts. Rather than looking at your credit alone, they also look at your ability, stability, and willingness to repay an auto loan.
They do this by asking for proof that you are who you say you are, live where you say you live, earn the amount you claim, and have steady employment. The specifics vary by lender, but typically you’re required to bring the following to the dealership with you:
- Your most recent computer-generated check stub showing year-to-date income, proving you make a minimum of $1,500 to $2,000 a month before taxes from a single employer where you’ve worked for at least six months.
- A current utility bill in your name, at the address listed on your application.
- Proof of a working landline or contract cell phone in your name – pre-paid cell phones won’t work.
- Six to eight personal references with names, addresses, and phone numbers.
Bringing all these documents with you to the dealership goes a long way toward helping you get auto financing. Not all dealers work with subprime lenders, however, and those that do often don’t advertise this fact. So, how do you know where to start looking for financing after you’ve gone bankrupt?
Finding the Lenders You Need
Here at Auto Credit Express, we work with a nationwide network of special finance dealers that have the lenders you need when you’re looking for auto financing after a Chapter 7 or Chapter 13 bankruptcy. We want to help take the stress out of going from dealer to dealer searching for the right lenders by matching you with a local dealer that can help.
The process is easy to get started, and it’s always free of both cost and obligation. Take the first step toward rebuilding your credit with an auto loan by filling out our online auto loan request form today!