A lot of my clients equate the time that bankruptcy will stay in your credit report to the time you will be without credit. This can scare some people from filing bankruptcy. What if you need to finance a car?
Yes, the word “bankruptcy” can stick to your credit report for up to 10 years. No, this does not mean that you cannot get a car loan or any credit during the 10 years.
Ouch! High Interest Auto Loan
Right after bankruptcy discharge, I have some clients tell me that they got solicitation for car loan. I warned clients against getting financing for a car right after bankruptcy discharge because the interest rates will be exorbitant. After bankruptcy discharge, clients will need time to established their credit. It does not take as long as you think. I have some clients tell me that they were able to achieve a respectable credit score after two years of establishing good credit history. For more information on how to rebuild your credit after bankruptcy, call Muoi Chea, experienced Sacramento Bankruptcy Attorney with a main bankruptcy law office in Sacramento California.
If you need a car in the near future, it might be best to get an auto loan prior to filing bankruptcy whether it be a Chapter 7 or 13 Bankruptcy. In a Chapter 13 Bankruptcy, you might be able to reduce the interest rate significantly. However, you must make sure that the term of the loan mature before the end of your Chapter 13 Bankruptcy plan payment. The maximum term for Chapter 13 Bankruptcy plan payment is 60 months. It was easier to get a car finance for a term less than 60 months 10 years ago than today. Maybe the lenders are catching on. Today, my clients are having a difficult time finding a lender that is willing to finance for less than 60-month term.
For more information about financing an auto loan or obtaining credit after bankruptcy discharge, call Muoi Chea, experienced Sacramento Bankruptcy Attorney, serving residents in Fairfield, Stockton, and Sacramento, California as well as other nearby cities. I serve clients throughout Northern and Central California like Roseville, Rocklin, Woodland, Davis, Elk Grove, Citrus Heights, West Sacramento, Yuba, Sutter, Vacaville, Vallejo, Folsom, Modesto, Tracy, Lodi, Galt, Fairfield, Stockton, Sacramento, CA.