Car Loan During Bankruptcy Is Possible - If You Know What To Do

A car loan during bankruptcy is a real possibility and doable if you know how to go about it. It will require a team of experts to pull a deal together but it is an obtainable goal. This is great news that can provide a sense of relief during a difficult time.

In most cases bankruptcy is a stressful situation at best. This article may provide hope if you find you are in need of a set of wheels as you work through the bankruptcy process.

Let’s examine a little more closely how this works.

Most likely you will hire an attorney to file your bankruptcy in the judicial court system. Once your claim has been filed you will be assigned a court appointed trustee who will draw up a bankruptcy estate. This estate will list all your debts along with your specific assets. This estate provides your lawyer and trustee a clear snapshot of your entire financial situation.

In some cases the attorney and trustee will recommend that you let your current car loan be discharged with the balance of your other debts. After complete review of your debt to income ratio your team may determine that your current car loan is simply too expensive to try and maintain after the bankruptcy.

This may leave you without a car. Because most people cannot go without a car, this may require a “new” car loan during bankruptcy. If this is the case for you, you will want to work closely with your bankruptcy team and follow their suggestions for getting a car loan.

In order to get a car loan during bankruptcy you will require a letter of permission that will be drafted by your bankruptcy trustee. This is a letter that will be attached to your loan application for potential lenders to review. In addition, a copy of this letter will be filed with your bankruptcy claim for the judge to see.

They will probably also suggest that you look for a quality used car that you can easily afford. You don’t want to buy more car than you can afford at this time as you begin to rebuild your credit.

The next step would be finding that quality used car at the best possible price. Many attorneys have begun suggesting you use an auto consultant to locate used cars. Auto consultants can be an excellent resource for a car loan during bankruptcy because of their personalized service.

Speak with an auto consultant and see if they have a special finance department. If they do, meet with them and discuss your situation. Most car broker work for you, keeping your interest in mind at all time, and will show compassion and understanding for your specific needs.

By: Mike Reitz

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