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Auto loans After Bankruptcy - Tips to Getting Approved
A car loans after a bankruptcy is an excellent method to assist build back your credit report. Actually, once your bankruptcy closes, you can obtain a auto loan the next day. To obtain approved using the best rates for the car loan, try this advice.
Review Your Credit history
Before you start applying for an auto loan, check out your credit report and make sure all of your accounts have been in order. It is not uncommon after a bankruptcy to see open accounts that should be closed, which hurt your credit history.
While looking at the credit report, consider adding a page explaining the situation that led to your bankruptcy. If there have been extenuating circumstances, lenders may approve you for a better rate than under normal conditions.
Plan Your vehicle Purchase
Before investing in a vehicle, decide what you can afford inside a monthly auto loan payment. This will help you decide which financing package is best for you. Both the loan amount and period of payments determines your monthly payments, so there's flexibility in determining which vehicle you can afford to purchase.
Make use of a Auto loan Lender
Auto loan lenders make their money by finding a loan. Car loan lenders use several financing partners to back loans with lots of different credit risk, including bankruptcies.
Online auto loan lenders deal with thousands of loans, and may usually find you a better deal than your local car dealerships. Online auto loan lenders will send a check when you're approved, basically making you a pre-approved car loan buyer.
Explain Your circumstances
Car loan applications will ask if you've ever declared bankruptcy and why. This is your chance to explain what led up to the situation and what steps you have taken to solve your credit situation. Be sure to include improvements in your credit history too.
Consider Refinancing
When you are approved for any auto loan, keep your eye on future refinancing. By looking into making regular payments on all your bills, in a year's time you can qualify for significantly lower interest rates. In 3 years, you can build your credit rating to near excellent and be eligible for a even lower rates.
