Why You Should Buy or Lease A Car after Bankruptcy with Bad Credit

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Why You Should Buy or Lease A Car after Bankruptcy with Bad Credit

Posted On : May-17-2011 | seen (1135) times | Article Word Count : 754 |

When you have a preferred car in your mind, approach the finance manager at your local car dealership which type of post bankruptcy car financing structure is recommended for that particular automobile manufacturer.

Whether it’s to buy or lease a car after bankruptcy, it is important for you to know the lender's credit guidelines when you apply so that you know which financing terms are more favorable to you. You can get away with lesser inquires by car loan lenders that will reject you anyway, so this helps to avoid further credit checks that will aggravate your FICO credit scores by up to 12 points per inquiry. So the first step is to understand the typical car financing guidelines for people who filed bankruptcy previously.
Be up front and ask directly whether they are willing to finance car buyers with bankruptcy or not. There is no point in hiding because they will know after a credit check on your name and SSN is done.
If a dealer tells you they cannot give you auto loans or lease a car to people after bankruptcy, just look for one that do so and check out their terms. Most of the time, you will find that it is easier to lease a car after bankruptcy though some lenders will offer car purchase financing with high interest. If you are in Texas, there may be lenders offering hybrid lease/loan deals.
When you have a preferred car in your mind, approach the finance manager at your local car dealership which type of post bankruptcy car financing structure is recommended for that particular automobile manufacturer. Generally, it is easier to get post bankruptcy car financing from the captive lenders (finance division of car manufacturers) compared to banks and credit unions. There are extra incentives and offers given to consumers when these captive car loan lenders wanted to quickly sell off a particular model especially at season end.
When you are at the bad credit buy here pay her car dealers, you need to be flexible and open to all available lending sources. Some of these may be captive lenders, banks, credit unions or even sub-prime finance companies - the only thing that matters is how much are the fees and loan/leasing rates. Ask these entire car loan companies whether they prefer to offer lease or purchase financing to a bankrupt person.
Generally, it is not recommended to approach the sub-prime car finance companies because of their higher fees and loan rates. However, they always remain as an available option when you must have your own vehicle now. For example, try approaching legitimate and BBB accredited car financing companies such as HSBC Automotive, Capital One, AmeriCredit, WFS Financial if you need bad credit subprime auto loans.
There are some captive lenders that are easier to work with when you are bankrupt while others are very difficult to get approved. For example, the finance divisions of luxury car manufacturers such as BMW, Mercedes, and Porsche will not be interested in you once they found out you have filed bankruptcy previously. Even for mainstream car manufacturers like Honda, Kia, Subaru and Toyota etc, it is near impossible to get a new lease or loan from them with bad credit. If you must buy or lease a new BMW car, you have to wait for several years after complete bankruptcy discharge and rebuild your FICO credit to perfect ratings above 720.
Make sure you have the latest copy of your credit report and FICO scores when approaching the local buy here pay her car lots. The dealers will know you are a well informed car buyer and less likely to try and fool you. Do not be confused when they insist on using the FICO Auto Industry Option scores to highlight your bad credit auto loans problems.
It is not always a fixed rule that leasing a car after bankruptcy is cheaper compared to purchasing. The available incentives and loan rates can change with time and make buying a car more affordable. And in most cases, it is not up to you to choose since you need a lender that is willing to finance you.
If you are recently discharged from bankruptcy, choose the lenders that are willing to work with you and can you accept their interest rate? Be sensible and do not stretch your finances too thinly just to drive a car now. Make sure your lender reports to all three major credit agencies in order to help you re-establish a good credit rating. You can then make a better decision to lease or buy a car after bankruptcy when your dealer or car loan broker has compared quotes from various lenders.

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<h1>Why You Should Buy or Lease A Car after Bankruptcy with Bad Credit</h1> Author: <a href='http://www.articleseen.com/profile_Karan Agarwal.aspx'>Karan Agarwal</a> Whether it’s to buy or lease a car after bankruptcy, it is important for you to know the lender's credit guidelines when you apply so that you know which financing terms are more favorable to you. You can get away with lesser inquires by car loan lenders that will reject you anyway, so this helps to avoid further credit checks that will aggravate your FICO credit scores by up to 12 points per inquiry. So the first step is to understand the typical car financing guidelines for people who filed bankruptcy previously.
Be up front and ask directly whether they are willing to finance car buyers with bankruptcy or not. There is no point in hiding because they will know after a credit check on your name and SSN is done.
If a dealer tells you they cannot give you auto loans or lease a car to people after bankruptcy, just look for one that do so and check out their terms. Most of the time, you will find that it is easier to lease a car after bankruptcy though some lenders will offer car purchase financing with high interest. If you are in Texas, there may be lenders offering hybrid lease/loan deals.
When you have a preferred car in your mind, approach the finance manager at your local car dealership which type of post bankruptcy car financing structure is recommended for that particular automobile manufacturer. Generally, it is easier to get post bankruptcy car financing from the captive lenders (finance division of car manufacturers) compared to banks and credit unions. There are extra incentives and offers given to consumers when these captive car loan lenders wanted to quickly sell off a particular model especially at season end.
When you are at the bad credit buy here pay her car dealers, you need to be flexible and open to all available lending sources. Some of these may be captive lenders, banks, credit unions or even sub-prime finance companies - the only thing that matters is how much are the fees and loan/leasing rates. Ask these entire car loan companies whether they prefer to offer lease or purchase financing to a bankrupt person.
Generally, it is not recommended to approach the sub-prime car finance companies because of their higher fees and loan rates. However, they always remain as an available option when you must have your own vehicle now. For example, try approaching legitimate and BBB accredited car financing companies such as HSBC Automotive, Capital One, AmeriCredit, WFS Financial if you need bad credit subprime auto loans. 
There are some captive lenders that are easier to work with when you are bankrupt while others are very difficult to get approved. For example, the finance divisions of luxury car manufacturers such as BMW, Mercedes, and Porsche will not be interested in you once they found out you have filed bankruptcy previously. Even for mainstream car manufacturers like Honda, Kia, Subaru and Toyota etc, it is near impossible to get a new lease or loan from them with bad credit. If you must buy or lease a new BMW car, you have to wait for several years after complete bankruptcy discharge and rebuild your FICO credit to perfect ratings above 720.
Make sure you have the latest copy of your credit report and FICO scores when approaching the local buy here pay her car lots. The dealers will know you are a well informed car buyer and less likely to try and fool you. Do not be confused when they insist on using the FICO Auto Industry Option scores to highlight your bad credit auto loans problems. 
It is not always a fixed rule that leasing a car after bankruptcy is cheaper compared to purchasing. The available incentives and loan rates can change with time and make buying a car more affordable. And in most cases, it is not up to you to choose since you need a lender that is willing to finance you.
If you are recently discharged from bankruptcy, choose the lenders that are willing to work with you and can you accept their interest rate? Be sensible and do not stretch your finances too thinly just to drive a car now. Make sure your lender reports to all three major credit agencies in order to help you re-establish a good credit rating. You can then make a better decision to lease or buy a car after bankruptcy when your dealer or car loan broker has compared quotes from various lenders.
About the Author: Karan Agarwal is a regular writer on <a rel="nofollow" href="http://www.afterbk.com/">Afterbk.com</a> which is a US based company. The adage of the company is to provide updated information on bad credit <a rel="nofollow" href="http://www.afterbk.com/">auto loans</a> as well as subprime auto loan financier. Article Source: <a href='http://www.articleseen.com/Article_Why-You-Should-Buy-or-Lease-A-Car-after-Bankruptcy-with-Bad-Credit_62343.aspx'> http://www.articleseen.com/Article_Why You Should Buy or Lease A Car after Bankruptcy with Bad Credit_62343.aspx</a>

Article Source : http://www.articleseen.com/Article_Why You Should Buy or Lease A Car after Bankruptcy with Bad Credit_62343.aspx

Author Resource :
Karan Agarwal is a regular writer on Afterbk.com which is a US based company. The adage of the company is to provide updated information on bad credit auto loans as well as subprime auto loan financier.

Keywords : bad credit auto loans, auto loans,

Category : Finance : Loans

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