Auto Loan After Chapter 7 Bankruptcy
I need an auto loan after Chapter 7 bankruptcy, but wondering if I can get the car I want. I recently just got out of bankruptcy and I pulled my credit score it's currently at 534.
I'm looking to purchase a 2008-2010 Malibu and I have $1,500 saved as a down payment. What do you think my chances are at getting into a vehicle?
While I was in bankruptcy I got a approval from a subprime here in Georgia for 14K but I haven't tried anywhere else yet.
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You'll definitely be able to get approved for an auto loan after chapter 7 bankruptcy, but the question will be for how much and will that amount allow you to buy the Malibu you want.
There are a lot of factors that are taken into consideration on the lenders end when loaning money in these situations.
One key will be your monthly income and if you make enough to support the monthly payments. You will be paying a high rate of interest since this is your first loan after the bankruptcy which will drive your payments up.
A $16,000 loan at 19% will run you just over $400 a month and if you don't make at least $2700 a month, then you more than likely won't get approved.
That being said, I don't think you'll be financing quite that much if you look at 2008 models.
The lenders will also take into consideration past auto loans and any that may have been taken down in the BK as well.
To sum this up, you will most definitely get approved (assuming the dealer works with the right lenders), but for how much and at what rate I'm not sure.
You may also need to put some money down in order to get a better approval (lower rate). For an auto loan after chapter 7 bankruptcy most lenders are looking for a minimum of 10%, but some will take as little as $500-$1000.
You should be in good shape with the $1500 you currently have, but the more the merrier!
Good luck to you and be sure to not get in too over your head. If you have to settle for a Malibu with maybe less options than what you'd like that's okay, because you really want to use this loan to get your credit reestablished.
Once reestablished your next time around you'll be in much better shape.
Hope this helps,