Post bankruptcy, it is critical to start rebuilding your credit as quickly as possible. The easiest way is to get any type of credit card you can-unsecured and/or secured. Credit cards are important because they show credit bureaus how you manage revolving credit. Additionally, it is also important to have "installment credit" such as personal loans and/or auto loans. This shows the credit bureaus how you manage installment credit. Making timely payments is vital to installment credit in order to re-establish a good credit history.
The question is after bankruptcy how can you get a loan?
After bankruptcy, your credit is still quite shaky. The good news is that you CAN get a personal and/or auto loan after bankruptcy. The only catch is you will have to do some research in order to get one. You will also have to jump through more hoops with lenders as well.
Here are things to keep in mind when loan shopping:
1) Find out your credit score. This is important to know so you know what kind of interest rates you may be facing.
2) How much other existing debt are you carrying? Your debt to income ratio is important. If your debts are too high, lenders may feel that you cannot repay the loan as your expenses are too high.
3) If you have any collateral to offer lenders, such as a down payment or a co-signer know that will assist greatly in getting you approved for a bad credit tribal installment loans.
4) How long has it been since your bankruptcy was discharged? Understand that the sooner you apply for tribal lenders post-bankruptcy, the worse condition your credit will be in. It may be wise to start re-building your credit with a few credit cards first then apply for indian reservation installment loans in order to get better rates. If your circumstances will not allow you to wait, The Bankruptcy Shop works with a few lenders who specialize in lending to high risk clients such as those who have bankruptcy.
The re-establishment of your credit is essential after bankruptcy in order to improve your credit score. Good credit scores allow you to get lower interest loans and credit cards which will ultimately save you money. Getting an auto loan post-bankruptcy may be one of the best moves you can make. An auto loan will assist in repairing your credit because it will establish a record of regular, timely payments that will raise your credit score.
You may be asking how can I get an auto loan if my bankruptcy?
With my bankruptcy recently discharged, who will finance me?
These are valid questions and not easy to answer. The best strategy to get to secure auto financing would be to take the following steps before going into a dealership.
1) Make sure you know your credit score. You are entitled to a FREE copy of all three of your credit reports annually. You may also visit My FICO which is a pay site to see your current credit score. Before going to look at cars you need to know exactly what your financial position is in order to give you some idea of what kind of interest rates you will be facing.
2) If you can postpone getting a new car for a few months post-bankruptcy in order to give your credit time to "heal" by obtaining a secured or unsecured credit card and making sure to pay the balance in full monthly, you may find yourself eligible for better interest rates and thus, more favorable auto loan terms. Although it may be tempting to go to your local "instant credit" auto dealership, it would be best to start with major dealerships first. Obtaining a loan from a major dealership looks better on your credit report and would have more favorable rates than one from a subprime facility. Although, depending on your credit score, though, you may not have that option.
3) Do NOT complete multiple online financing applications. By doing this, each auto financing lender will run your credit report, thus lowering your credit score by each "inquiry" that it hits your credit file. Instead, contact the dealerships you are interested in directly and inquire if they will consider financing someone with a recently discharged bankruptcy. Tell them what your current credit score is, how much you can afford for the down payment, and whether you have a trade in vehicle. If they state they are willing to work with you, then make an appointment to speak with them personally. You may also get pre-qualified online, and take the "pre-qualified" terms to the dealership, thus giving you additional negotiating power when selecting your vehicle. JUST REMEMBER, DON'T SUBMIT MULTIPLE APPLICATIONS ONLINE in hopes that maybe one lender may approve you. We work specifically with auto-financing lenders who are familiar with situations just like yours.
4) For your appointment with the lender, be sure to bring proof of income such as paycheck stubs, your checking and savings account information, and your trade in vehicle information such as the car title, etc.
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