Buying a Car After Bankruptcy...
The Ins And Outs

Buying a car after bankruptcy is not impossible. If you have just filed bankruptcy and you no longer have a car, you probably want to do something about that!

You may have been heartbroken watching your car being towed away (I was), or you may have given it back because you did not want those high payments. Either way, you need transportation-unless you live somewhere that has great public transportation or you can bike everywhere (which is my personal choice if I can).

It doesn't have to be a car that has all of the gadgets and it doesn't have to look "sexy". It just has to get you to where you need to be and back.

Remember you are in the phase of getting back on your feet and you sure don't need get yourself back into trouble again. You are not looking for "THE" car right now, and also know that "THE" car will come.

I was thinking that buying a car after bankruptcy would be impossible. And after my car was towed away, I needed to get something that would get me around. I went to a Subaru dealership and found an old Subaru on the lot.

Yes it had some rust and yes the clutch had to be babied, and yes it was embarrassing to drive after the sporty, sexy car that I was used to, but I got it for $800 and had no monthly payments. The insurance was a lot less too. That Subaru just kept going and going and going. It never did need a new clutch. I eventually gave it to my brother.

KNOW THIS: YOU ARE NOT YOUR CAR. So drive what works for you for where you are now.

If you have bought a car after bankruptcy for cash, please share your story so that others can be encouraged to do the same!

Research

It's easy to find the value of a car that you are looking at. I like to use these two sites for checking out values: kelly bluebook Edmunds

When my daughter and I were shopping for her car, we went to a dealer with the intention of just looking. The sales person was very good. He had us looking at a car we had never even considered and was willing to make us a really good deal.

It was the end of the month and he wanted to hit his quota. But we needed to commit to buying the car today. I never give in to this kind of pitch, however I didn't think it would hurt to test him on what he was saying.

Since I had never considered this car, I had not done any research on it. The car was a two year old Ford Escort, with very low miles, which I liked a lot. But I didn't have any clue what it was worth.

I asked the sales person if there was a computer that I could use and he gave us an office and access to a computer - and privacy. We checked on the value of the car, went back into his office and were able to negotiate a great deal.

The deal was so good that now, four years later with 50,000 more miles the blue book is what we paid for it.

If financing is the way for you to go, here are some options to think about. Keep in mind that any financing that you do will be easier and you will get a much better interest rate once your discharge is one year old. Before that, expect to pay more. Again, be careful not to get in over your head.

Credit Unions

They offer great rates and really good service to their members.

I used to think that I needed to be a teacher or be a member of a group tp be able to join a credit union so I never considered joining one. I have learned that there are all types of credit unions.

The city that I live in has a credit union and I just need to live in this city to join.

It was an awakening for me. My credit union even has a car shopping service. I tell them what I want and they go out and find the best deal. They will even go and pick up the car, so I never even have to go to the dealership if I don't want to.

You can find a credit union in your city or state simply by going to http://www.joinacu.org/ to find a credit union for you to join. It's a great web site that will let you know what credit unions are in your area. They answer the question "What is a Credit Union" with:

"A credit union is a member-owned, not-for-profit, cooperative financial institution. Credit unions operate under a unique philosophy of “people helping people,” allowing their members to pool their savings, lend to one another, and own the organization where they can obtain financial services. Credit unions exist solely to serve their member-owners, and provide favorable savings rates and low-interest loan rates.

Nearly 90 million people in the U.S. belong to a credit union. By joining a credit union, you too can enjoy the advantages of being a member-owner of your financial institution—not just a customer!"

If you do join a credit union and use them for your financing, be careful of what is called "indirect lending". This means that they have the dealer actually do the paper work for your loan and it will cost you extra. So, just make sure you go directly to the credit union and have them do your paperwork.

Your Local Banker

If you have been current on the payments for the credit that you have and if your discharge is getting on up to a year, this could be a good option.

If you are just discharged, you may need to get a co-signer. Talk to your banker and ask what it would take for the bank to give you a loan. If a co-signer would help you to get the loan and you know someone who would do it for you, then go ahead. Just make sure you aren't getting in over your head.

Dealerships

However, sometimes things just work out and it's always worth a try if you have the fortitude and stomach for it. In other words, don't take them too seriously and have some fun with it. Know that they are trying to get the best deal for themselves and will hurt you and lie to you to get that.

If you are dealing with a dealership, remember to always stay focused on the price of the car. They will entice you with low payments by stretching the length of the loan, but it won't be to your advantage.

Know the price of the car before you go in by shopping online. Know what you are willing to pay and what you are willing to pay in finance charges.

Online, Bad Credit Loans

I would suggest that you apply one time to a company that finds loans for anyone with bad credit. What they do is look for loans from companies that specialize in bad credit car loans.

You will need to have a job (income) and you will pay a higher interest rate and may need to put more money down.

The reason you want to apply one time is that every time you apply and get rejected, the rejections go on your record and will actually lower your score.

Always do your homework and read the fine print. Know what type of loan you are getting and what all of the terms are.

Once you have your loan and you have started to turn your credit around by making your payments on time, you can refinance your loan for a better rate.

Be very careful and make sure that you can afford to get this loan. Ask yourself if you really need this car - can you find a less expensive car that you can pay for with cash?

For more help in getting your credit straightend out and help buying a car after bankruptcy, get your FREE copy of From Bankruptcy Into Abundance NOW!