Receive Car Financing After Bankruptcy

We understand that the past couple years have been exceptionally difficult for many of us out there even after a bankruptcy auto loan. Just because you have fallen behind shouldn’t completely limit your options for buying a vehicle if you have bad credit.

Even people in bankruptcy can get approved for auto loans in your area. Car loans after bankruptcy can become rewarding for almost anyone, no matter how bad the credit.

Bankruptcy Auto Loans

Finding bankruptcy car loans can seem like a monumental task, but it really isn’t at all. There are typically two forms of bankruptcy you can file for, and get an auto loan with.

Chapter 7 Bankruptcy

Provides an "order of relief" that causes an "automatic stay" for debtors and collectors trying to pursue you or your property; as in they cannot come after you outside of the bankruptcy proceedings. During chapter 7 bankruptcies you are allowed to keep certain property that is exempt by the court trustee (see your states exemption policies), but all other assets will be liquidated. You many lose all or most of your stuff during this type of bankruptcy if you do not reaffirm for specific assets through the court. Depending on how much equity you have in your asset(s) this can be a really good or a really bad thing. To purchase a vehicle or file for an auto loan during a chapter 7 bankruptcy you must wait until after the 341 hearing for further instructions for your case.

Chapter 13 Bankruptcy

Auto loans are also included in this type of bankruptcy; they are designed for people who can currently pay their bills, just not all of them. The true purpose of filing a Chapter 13 bankruptcy is to help consolidate your bills (under court supervision and protection) to create and employ a repayment plan to previous creditors over an extended period of time.

In Chapter 13 Bankruptcy 2 Lengths of Terms are Available:

• 3 Year Repayment Plan
• 5 Year Repayment Plan

Get Financed After a Bankruptcy

Before applying for auto loans after a chapter 13 bankruptcy you will need to get an approved letter from a trustee, which requires the trustee to get the courts approval for any assets that you would want to keep. No progress can be made towards a bankruptcy car loan if the court denies the motion to incur any additional debt.

When trying to get an auto loan while in bankruptcy or even car loans after bankruptcy you may not be approved for financing. Every situation is different it all just depends on your personal situation, if the court grants you approval for a certain dollar amount and/or percent of interest and that deal matches what a car lot is willing to approve then you're in luck!