Are you thinking of getting bankruptcy car loans? Have you ever wondered how these loans work? Bankruptcy can happen to almost any individual. The financial situations of different individuals are completely varied and unpredictable at the same time. This generally happens because of the different varieties of businesses and jobs of people. Fortunately, there are laws allowing bankrupt individuals to start all over again. At present, you will find different ways of paying back loans and debts. With some of the best mediums of making debt payments available for the common people, it has become possible for bankrupt individuals to live their normal lives without worrying about creditors. Nevertheless, there is also a catch here.
Post bankruptcy, the credit rating of an individual is likely to get blown away. So, if you are bankrupt at any point of time, your credit rating will take a hit. In this situation, if you think of buying a car, your bankruptcy will be a disadvantage for you. This is because automotive dealers will be able to see your bankruptcy in your credit history. And purchasing a car with poor or bad credit is quite challenging.
H2: Car Dealers Who Deal with Bankruptcies
Since your credit has taken a hit, it is quite likely for you to wonder how it would be possible for you to be a good candidate for bankruptcy auto loans. Also, you might think you have chances of either settling for loans that might not be perfect for you or you would have to go through a number of rejections. Give these thoughts an escape space! Well, there are varied solutions you can effectively use when it comes to getting bankruptcy loans that perfectly suit your budget and requirements.
You will find a number of low-interest firms working with a huge network of car dealers and lending organizations to get hold of the right deals for individuals who are in the look out of bankruptcy auto loans. Having a clear idea of your monetary weaknesses is just temporary. These organizations will help you in getting back to great financial terms. One thing that you must always have in mind is that regardless of what your problems are, you will not be able to solve them or make them easier by giving up the idea of possessing a car.
Prior to making your way straight to car dealers who deal with open bankruptcies near me, it is necessary for you to go through chapter 7 and 13 of bankruptcy. Having a clear idea of these chapters will help you in knowing almost everything you need to know about availing bankruptcy car loans. In addition to this, you will also get a grip on the details of these loans while knowing the options available in the market at the same time.
Bankrupt Auto Loan: Knowing Chapter 7 and Chapter 13
Regardless of whether you are filing for chapter 7 or chapter 13 bankruptcies, there is just one thing that does not seem to change. With your bankruptcy case still open, it would be a little difficult for you to avail one of the several bankruptcy auto loans available across the market. Your bankruptcy case has the potential of freezing your chances of availing an auto loan. Nevertheless, there is absolutely no need for you to worry. You will get the time to make payments to the past creditors.
With that in mind, let us move our focus to understanding the differences between the different varieties of bankruptcies. It takes a number of months to complete Chapter 7 bankruptcy. On the other hand, chapter 13 bankruptcy can be completed between 3 and 5 years. So, the major difference between chapters 7 and 13 is the amount of time these chapters take to close these cases. With chapter 7 bankruptcy, you will need to make your debt payments as quickly as possible. All your non-exempt assets will remain on the line mainly because you will have to make debt payments very quickly.
On the other hand, chapter 13 bankruptcy takes several years to be completed. This chapter involves complete reorganization of the payment plan. Chapter 13 bankruptcy is specifically designed for individuals with regular income. Such individuals can still make their debt payments but they require extra time. The individuals can even catch up on their car or mortgage loan payments without having to use the other assets that they possess.
As has already been mentioned, pending bankruptcy cases can freeze your chances of getting bankrupt auto loans. Nevertheless, this does not necessarily mean you should completely stop looking for the different dealers handling such loans. Going through a large number of dealers in this category will help you in finding the right options that match your requirements. You will still be able to get hold of financial firms and car dealerships specializing in working with consumers in situations you are facing at present. Why? Because you will have full chances of getting a bankruptcy car loan once your case has been closed.
The Consequences of the Discharge of Chapter 7
It is necessary for you to arrange a meeting with creditors prior to having the lending organizations considering your request for a bankruptcy loan. This is important because chapter 7 filings tend to remain open for a time span of around four months. Always keep in mind that until and unless you get your bankruptcy case closed, you will not be able to avail a loan. Hence, it is necessary for you to clear all pending debts prior to applying.
Chapter 13 and Bankruptcy Auto Loans
It is your bankruptcy lawyer who will be able to help you out with chapter 13 bankruptcy. The professional will help you by offering good suggestions on the right way of getting a bankruptcy auto loan. You will have to follow a specific procedure for getting the loan. Following the right procedure is important in this case considering you are undergoing chapter 13 bankruptcy case. This means that you are still in the repayment period. And if you are thinking of availing an auto loan post bankruptcy, you are actually adding yet another debt to your uncleared debt list.
If you are thinking of availing an auto loan post chapter 13 bankruptcy, it is necessary for you to work in coordination with a knowledgeable court-appointed trustee along with a car lender for getting the approval. Post meeting the requirements of the court, you will be able to find what maximum interest rate you will have to pay and what is the largest loan that you can avail. Then the trustee will come up with the decision of whether you require the loan prior to completing your bankruptcy case or later. If your trustee is of the view that you can easily wait until your bankruptcy case is closed, you would not be able to avail the loan.
Majority of the financial advisors suggest waiting until the second year of bankruptcy prior to availing a loan. This helps in avoiding debt accumulation situations. It also helps the borrower is having improved financial standing once he or she has made payments of all the dues that they might be owing. Whatever might be the case, it is necessary for you to get court approvals. Getting court approvals will make it easier for you to get any of the bankruptcy loans available in the market. And, the bankruptcy car dealerships and the lenders will have complete peace of mind knowing that you have a financial situation that they can actually trust. Nevertheless, in situations when you do not have court approvals, it is quite unlikely for you to find good lending organizations ready to provide you with desired loans.
The Right Way of Availing Chapter 13 Bankruptcy Auto Loans
Judges and courtrooms are of the view that cars are necessities for a large number of people. This applies to almost every individual, regardless of what his or her financial condition is. However, it is necessary for every individual to abode by the rules. Also, every borrower needs to ensure that his or her documents and finances are in perfect line. Since you are already making payments of all your old debts, it is quite likely for the judge to find out reasons behind your request for another loan. You will have to explain the reasons in a very compelling and clear way. In other words, you will have to provide the judge with a valid reason for buying a car.
Here, it is necessary for you to know that there are a number of reasons you can present in front of the court making it believe in the fact that you are a fit candidate for a bankruptcy auto loan. One big reason you can present is that your old automobile has become quite unreliable. Another reason would be that the repairs on your old car are adding up to the expenses making it necessary for you to get a new car. Regardless of what your reasons are, always try to make them perfect and do not resort to the idea of presenting fake reasons. Go with the truth always and there is nothing that can stop you from getting a bankruptcy car loan.
If your reasons are considered feasible or valid by the judge, you will further be asked to provide the details regarding interest rates along with the repayment plan you are thinking of following. It is quite possible for the judge to set certain limitations on the loan you are availing and on the interest rates that you will be taking on. This entire procedure will take place only after you have placed a request for court filing. This is known as Motion to Incur Additional Debt. If your request for filing is accepted by the court, the judge will be issuing an Authorization to Incur Additional Debt. As a borrower, you get the flexibility of showing this to your lending organization as proof of your validation or qualification. This way you will have better chances of getting your loan approved by the lending organization because you have received a go-ahead by an established entity or law court.
The Reality about Bankruptcy Auto Loans
While it is absolutely true that lending organizations generally treat consumers with bad credit ratings as high risk, they also ensure that their clients have the potential of making their debt payments. Nevertheless, they are well aware of the fact that they cannot simply deny the loan requests of bad credit customers. There are some people who want loans during bad financial situations but this does not mean that they do not have the ability of making small payments towards smaller loans. For covering their backs and for getting more customers, the auto lending organizations increase their rates of interest. There are some borrowers who accept these high rates of interest while there are others who do not pay attention to the high monthly payments that they need to make. These are big blunders made on the part of individuals who are desperately in the look out of bankruptcy car loans. The consequences of making these mistakes are a suffering credit rating. These individuals cannot help but get into this vicious circle of making huge payments. You can always avoid this situation by going for the services of MacNeal Group. We will help you in getting decent cars with reasonable rates of interest and monthly payments.
It might be quite overwhelming to negotiate deals. If you are under any kind of financial pressure, it might be easier for you to make mistakes out of stress. Going for professional assistance and advice in this scenario can help you in making the perfect choices and in saving a huge amount of money. We, at MacNeal Group make it quite easy for consumers to avail bankruptcy car loans. We carry out all the negotiations on the part of our clients. So, there is absolutely no need for you to go through any kind of hassle.