- 1). Review your credit report and credit score. After filing for Chapter 7 it is possible that some of the debts discharged with your bankruptcy are still being reported as past due. Get your free credit report from annualcreditreport.com and your free credit score from creditkarma.com. Dispute any inaccuracies prior to applying for financing.
- 2). Go over your budget to determine how much vehicle you can afford. After filing Chapter 7 bankruptcy, it is important to avoid overextending yourself again. Prior to discharging Chapter 7 bankruptcy, the bankruptcy code requires individuals to complete a financial management course. Use the budgeting guidelines provided to help decide what monthly payment amount you can realistically afford.
- 3). Contact lenders and dealerships to see if they would be willing to finance someone with your credit score following a discharged Chapter 7 bankruptcy. Be upfront with potential finance companies and avoid applying for financing with companies that you believe will deny your application. Having your credit report pulled by multiple finance companies could lower your recently repaired credit score.
- 4). Complete an application with a finance company offering to pay the largest down payment that you can afford. Having a Chapter 7 bankruptcy will often lead to lenders charging a high interest rate. Paying a high down payment can help to keep your monthly payment affordable in spite of the high interest rate. Depending on how recently your Chapter 7 was filed, the finance company might ask you to provide a letter of discharge which can be obtained from the bankruptcy court or your bankruptcy attorney.
How to Finance Automobiles With a Chapter 7
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