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How the hell r people getting auto loans so soon? 5months post-BK, just denied twice.

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    How the hell r people getting auto loans so soon? 5months post-BK, just denied twice.

    (wow this thread title character limit is ridiculous)

    My discharge was June 1st. My credit scores did not make it out of the bankruptcy very good at all. But I'm employed and looking for cars that are just in the $2-4k range or so. I'm pretty desperate for a car actually as I just accepted a new job which starts next Monday and I cannot get there without a car. Yesterday I applied for a loan through Capital One (one of my old creditors) and they denied me. I applied through my credit union and they denied me, saying they need to see at least 6-9 months post-bankruptcy and some established credit or something. I just don't understand how the hell people are qualifying for loans right out of a bankruptcy. Is there anything I'm missing? Will a used dealership be likely to give me a loan? I've got $500-1000 to put down.

    #2
    Have you called any dealerships? Would your attorney have any suggestions. Our attorney had a list of dealerships that work with people who have been through bankruptcy. You could call a few dealerships and ask if they anyone who helps those who have been through bankruptcy. I know I have seen advertisements for those with "bad credit" maybe they would have options (I know the interest wouldn't be the best, but it would be a start)

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      #3
      I didn't think of that, I'll get back in touch with my attorney. I haven't tried asking dealerships yet but that's pretty much my only path forward at this point. I understand the interest rates would be crap but with several hundred dollars down on a pretty cheap car the payments won't be too bad.

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      • PANSYFACE
        PANSYFACE commented
        Editing a comment
        I got a car loan from Capital One about a year and a after discharge - the interest rate was 10.2. After another year I was able to refinance it to a loan with 3.4 rate. Just get what you need anyway you can and then refinance it later.Or see if you can find a car that someone's parent can no longer drive because of problems and buy outright. A friend of mine got most of his cars that way and they were in almost mint condition.

      #4
      I’ve gotten a lot of junk mail from lenders, albeit at bad rates, since filing. I strangely recently received some even having been discharged for six plus months. I realized they target you on specific dates. I think this latest onslaught was one year after I first contacted my attorney. Wow it’s been that long. But you will get there.

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        #5
        I'd contact your attorney and dealerships in the area. I know in Houston, they are 2 major dealerships that have people who reach out to people during the process. I received multiple offers from Toyota, Honda, Acura, and Ford to see them once I have my discharge papers.

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          #6
          If you have $500 -$1000 down another option might be just to save a little more and buy a car cash from a private seller in the $1500 range. Especially if you are somewhat mechanical. If a dealer sells a car for $4,000 chances are your average private seller would sell it for $2,500. You get far more buying from a private party... with the catch that you need to be careful and check to make sure there are no major issues with the vehicle prior to purchase.

          The benefit would be no payments. Those buy here pay here places usually rip you off. For a $2,000 car they will for instance want you to pay $80 a week for a year or more. Since it is weekly payments there is a higher chance of missed payments which mean more late fees and more repossessions. I would drive a $750 rust bucket before I would go to one of those places!

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            #7
            I cant get the auto dealerships and other companies to leave me alone. The Ford dealership down the street keeps sending me letters wanting to work with me through bankruptcy. I did not need a car so I didnt inquire on any of any of these, but I imagine they are high interest. A dealership would be more ideal to work with than the loan shark companies. Try Ford or Chevy. I also got letters from La Fontaine. They seem to really want to help to the effect that I get letters pretty much biweekly.

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              #8
              Originally posted by stormygate View Post
              I cant get the auto dealerships and other companies to leave me alone. The Ford dealership down the street keeps sending me letters wanting to work with me through bankruptcy. I did not need a car so I didnt inquire on any of any of these, but I imagine they are high interest. A dealership would be more ideal to work with than the loan shark companies. Try Ford or Chevy. I also got letters from La Fontaine. They seem to really want to help to the effect that I get letters pretty much biweekly.
              I seriously doubt a dealership will work with me at this point. I applied for a loan at a used car dealership a few days ago (a couple days after the 6 month post-BK mark actually) and they weren't able to find a lender who would work with me. All I wanted was a loan for a $4000 car with $800 down. I make almost $40k a year. I just don't understand how you people are getting all these auto loan offers. I'm getting seriously desperate.... I'm driving an "unsafe" car (according to my mechanic) to work every day and I'm just waiting for the engine to fall out of the car on the highway any day now.

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                #9
                I personally say to never ever let the dealership do a "shotgun" application for you. They send it to 4, 5, 6 or more banks/creditors that all run your credit. I would go to a local credit union and that is what I did when I was 6 months out from my discharge. I went to Navy Federal and they were very gracious and very generous.

                Also, before you even put in one application, make sure you've run a three-bureau credit report with score and see what the banks are seeing. You may not have cleaned up yoru credit report and there may be things lingering which should not be there.

                Fresh out of Chapter 7... everything on your report should be $0 and closed, or $0, closed and Included in Bankruptcy (IIB). There should be no other history. Perhaps you don't even have a score? Have you started by getting a couple of initial credit cards so that you have some trades reporting to the credit bureaus?
                Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
                Status: (Auto) Discharged and Closed! 5/10
                Visit My BKForum Blog: justbroke's Blog


                I am not an attorney. Any advice provided is not legal advice.

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