Although buying a car in bankruptcy may take a little more effort on your part, it is not impossible. This is good news to anyone who has fallen on hard times with no other way out except to file bankruptcy.
Buying a car in bankruptcy will require you to take a few extra steps but the reward will be a chance to begin rebuilding your credit right away. Obtaining a car and faithfully paying it off on time is the best way to reestablish a positive credit score.
Let's take a look at how it works.
When someone petitions for bankruptcy, they will be placed into the court's judicial system. This requires an attorney who will represent you and help you to understand the bankruptcy laws. In addition you will be assigned a court trustee who will draw up a bankruptcy estate. In this estate your assets will be listed along with your debts. Consult your attorney and trustee before buying a car in bankruptcy.
If the attorney and trustee agree that there is a necessity for a car loan, the trustee can draw up a letter of permission giving you the go ahead for buying a car in bankruptcy. The trustee will file this letter in your court file. This will assure that you are staying within the perimeter of the bankruptcy laws.
It is a good idea to follow the advice of your bankruptcy team, listen to what they suggest to you. Provide your proof of income to the attorney and the trustee so they can help you figure a monthly payment that you can realistically make on time.
They may suggest that you check into special financing auto dealerships. These dealerships specialize in helping people when buying a car during bankruptcy. Your bankruptcy team may even suggest such a dealership for you to visit.
Special finance dealerships have relationships with several lenders that provide auto loans and work with you to find the best possible solution to your specific needs. Because of your credit history, you will more likely have to pay higher interest rates. Don't let this stop you from getting a car. After making the payments on time you can usually refinance your loan later on for a better interest rate.
Finding a quality special finance car dealership will assure you peace of mind that you will get the best deal possible. This loan will help you get around with a nice set of wheels and provide you a great chance to reestablish your credit history.
Filing bankruptcy is never an easy situation but by being upfront and honest with your bankruptcy team, buying a car in bankruptcy is possible today.