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Bankruptcy Auto Financing

What You Need to Know About Obtaining Bankruptcy Auto Financing

The American Bankruptcy Institute reports that the number of people that filed bankruptcy in the U.S. between 2014 and 2015 decreased 10 percent. However, that does not change the fact that 819,240 people filed bankruptcy in 2015. When you think about that, that is thousands of people who will have trouble obtaining financing for a vehicle. While it might seem harder to get bankruptcy auto financing, it is not impossible. In fact, there are some things you need to know to help you get a car loan after filing for bankruptcy.

You Can Find Hope with Direct Financing

Going from bank to bank may prove difficult when you attempt to apply for a car loan after having filed bankruptcy. In fact, if you have tried it, you have likely dealt with a lot of head shakes and absolute denials. While it is harder to get approved for an auto loan through a bank when your financial history is flawed, that does not mean you have to put the brakes on your car search.

One way to secure financing on a vehicle after filing bankruptcy is by talking to someone who is willing to direct finance you. Buy here pay here places or BHPH dealers, are often most willing to work with you. BHPH dealers provide you with their own bankruptcy auto financing. Since they do not go through a financial institution, they can get you into a vehicle of your choice. Even if you have subprime credit or a bankruptcy on our report, you can still receive the car financing you need with a BHPH dealer.

In truth, when you file bankruptcy, it stays on your record for 7 to 10 years. Chapter 7 bankruptcy erases most of your debts and stays on your record for 10 years. With Chapter 13 bankruptcy, you still end up paying off most of your debts, and it stays on your record for 7 years. No matter which chapter you filed, you will likely need to replace your vehicle over the course of 7-10 years. In other words, a BHPH car lot can provide you with the auto financing options you are looking for.

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Think About What You Need

When it comes to replacing your vehicle, list out what it is you want and need from a car. Your list may contain some of the following:

  • • Reliability
  • • Safety standards
  • • Anti-lock brakes
  • • Power locks and windows
  • • Power steering
  • • 4-Door
  • • 2-Door
  • • Roomy
  • • Comfort

Those are just some of the fundamental aspects you would likely search for in a vehicle. Luckily, you can find all that and more at Liberty Cars and Trucks. You should, however, stick within your financial means. For instance, do not choose a newer car with all the bells and whistles if you cannot afford it. BHPH lenders are willing to work with you to find a vehicle that best suits you within your budget. Your best bet is to work with them so you can find something that will not land you in another financial pinch.

Despite the fact that you have filed bankruptcy, it is still possible to rack up debt all over again. You can avoid this problem by obtaining the funding you need for a vehicle with a reputable BHPH dealer. A reputable BHPH dealer is willing to work with you as far as your monthly payments and the loan term length. By sticking to what you need out of a vehicle and not getting too elaborate, you can get affordable payments.

Be Ready to Provide Documentation

Although bankruptcy auto financing works different from traditional financing, you will still need proper documentation. Since you are a high-risk borrower, you will need to prove that you can afford the monthly payments on a vehicle. Expect to produce proof of a valid driver’s license, evidence of employment and bank statements showing how much you make.

Your best bet is to contact a BHPH professional near you to find out exactly what documentation you are going to need. They can go over the details with you so that you can show up prepared. If you show up with all of the proper documentation in hand, it is likely that you will be able to leave with a vehicle that same day. Since BHPH dealers do not go through conventional loan institutions, they do not have to wait for approval. They can verify your information right then and there and get you into a car that you want and need. As an added note, when you gather all of your documentation together, it is recommended that you have at least 3 months of verifiable income with you.

Filing bankruptcy may seem like a challenging and even scary choice regarding your future. Luckily, BHPH lenders can help you by ensuring you receive fair rates on a car loan despite the fact that you have a bankruptcy on your record. Speak with a professional today about a car loan to determine what you need to do to qualify for a vehicle you want and need.

Sources: “Total Bankruptcy Filings Down 10 Percent in Calendar Year 2015,” American Bankruptcy Institute.


Bankruptcy Auto Financing - Car City

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