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The sad fact is that Americans in increasing numbers have been forced to file for bankruptcy protection, oftentimes due to job loss when their companies shut down or laid off a large number of workers. Finding a new job in a weak economy can be difficult, and many hard working Americans simply fell behind on too many of their financial obligations and ended up in bankruptcy court.
If you are among those folks who have been forced to file for bankruptcy protection, you will be surprised to learn that financing the new auto loan that you need is not as difficult as you might have thought. In fact, an automobile loan is one of the easiest to obtain loans for those who are fresh out of bankruptcy.
Easy Car Loans After Bankruptcy
When your bankruptcy has been discharged, your credit slate is wiped clean. Albeit bankruptcy does leave your credit in a horrible mess, there is one characteristic of your credit that appeals to car loan servicers - you do not owe anyone anything. This means that you can afford to pay them when they finance your new car. And since a car loan is a secured loan that involves collateral (the car, in this case) the lender can be fairly assured of either being repaid for the loan or in repossessing the car and selling it to recoup their money. For this reason, qualifying for a car loan when your bankruptcy has been discharged is not that difficult.
Be Assured Of A Clean Slate
Because your new clean slate is important to the car loan servicer, it is important that you make sure that your credit record accurately reflects your new status change by pulling your credit file and inspecting it for accuracy. Each account that was discharged by the bankruptcy court should be noted as such, instead of being listed as delinquent or written off.
If you find that one of the three bureaus (Experian, Equifax, and Trans Union) has failed to accurately record the results of your bankruptcy proceedings, contact them immediately to demand that they update their files. For your purposes, it is important to check with all three of the credit bureaus because you cannot be certain which of the three that your car loan servicer will use when determining your eligibility for a car loan.
Chapter 7 Bankruptcy Filers
Car loans for those who filed for bankruptcy protection under Chapter 7 bankruptcy laws will see greater approval rates for their car loans than those borrowers who filed Chapter 13 (restructured). Filers who sought out a Chapter 13 bankruptcy will need to be approved for the loan through the means that the court has established, which typically involves meeting with a court representative to determine if the borrower can afford the purchase. Most of the recent bankruptcies were filed under Chapter 7 of the bankruptcy code, which means that borrowers have had their debts discharged and in this case do not need to go through any additional red tape to begin rebuilding their credit files by taking out loans like a car loan. |
