If you’re considering bankruptcy to help get your finances back in shape, but you’re worried about getting or keeping a car, have no fear, Auto Credit Express is here.
When you file for bankruptcy, you’ll either file a Chapter 7 or Chapter 13. Both bankruptcy options treat your property differently and which one you can file for depends on your debts and income. So, which bankruptcy you file will determine what you can keep and what you can’t.
A Chapter 7 bankruptcy is the most common, and is considered a liquidation bankruptcy. In a Chapter 7, you may need to give up your vehicle, second home, or other assets to your creditors in order to help pay off debts. Chapter 7 bankruptcies can last anywhere from three to five months, and the bankruptcy, itself, will stay on your credit report for 10 years.
In a Chapter 13 – also known as reorganization bankruptcy – you'll be more likely to keep your vehicle or home. Instead of giving up all your assets, you’re given a repayment plan to help pay your debts. This bankruptcy can last either three or five years, and it will stay on your credit report for seven years.
Getting an Auto Loan during Bankruptcy
Getting approved for an auto loan during bankruptcy isn’t impossible, but it’ll take some time and patience. There are some tips that can help improve your chances of getting approved for an auto loan, but be prepared to face some issues if you’re early on in the bankruptcy process.
The best advice is to wait until the bankruptcy has been discharged. But if you can’t wait months or years, you’ll need to do some planning. Make sure you keep your finances in check, and be prepared to work with your trustee once you’ve talked with a dealer. Plan on a down payment requirement, and have an affordable vehicle in mind to purchase.
We’ve Got You Covered
Finding the right lender to work with you can be difficult if you’ve filed for bankruptcy. At Auto Credit Express, we specialize in helping consumers find the right lender for their unique credit situations.
We work with a large network of special finance dealers across the country that have subprime lending resources available to help people in many types of credit situations, including bankruptcy. Get started today by filling out our no-obligation online auto loan request form.