Finding A Car Loan After Bankruptcy

car loan

Everyone knows that bankruptcy can be tough, especially when trying to find a car loan. After claiming bankruptcy, loan lenders become wary of approving you for large amounts of money because you have defaulted before. However, if you can prove you are at low risk of defaulting on your car loan, then they are more likely to work with you and not against you.

Issuing A Large Amount Of Money As Your Down Payment

Putting a large sum of money as your down payment will decrease the amount of your total car loan. It also gives your lender more assurance that you are trustworthy and will want to work with you. Putting a large down payment also proves you have the funds to afford the car loan.

Proof Of High Income

Most employers will assist you by issuing your proof of income to your loan lender. However, they will need paycheck stubs as your proof of income. What lenders are looking for is to see you staying with one job for at least two years or more along with high income, promotions or raises. For the people who are self-employed, it may be a little more challenging to find a lender.

Having Additional Collateral

Most auto creditors use the vehicle itself as security. However, you may select to put in extra resources, keeping in mind the end goal to secure the advance. Once more, this should be done if you can’t get the credit through another strategy. When you collateralize a benefit, you expel it from your advantage list.

Using A Co-signer

You should have a co-signer only if you are not able to find a car loan without one. Using a co-signer is borrowing that person’s credit score for your loan. However, this also means sharing the rewards of the credit scores with your co-signer. It is best to try to get your vehicle loan without a co-signer to rebuild your credit after bankruptcy.

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