I just bought a car two months out of BK.
Pre BK filing, I had a 690 credit score. After filing, I did the plunge to the high 5's/low 6's (depending on the bureau). I was discharged at the end of April. Right before discharge, I went to my CU and got a $500 secured VISA. No annual fee, 15% interest rate. I charge $25 a month on it so it reports and pay it off monthly. I think this helped my score a lot.
I went to look at a new Prius. The dealer pulled credit... 648! To qualify for zero percent financing, you need a 650 (Tier 3 with Toyota Financial). He noted I had two "repos" on my credit report. I told him I was doing a ride through on my motorcycle and had another car loan I reaffirmed. He said they would NOT give another car loan if you had a reaffirmation. (My parents were buying my old car that I had reaffirmed, so although it was reaffirmed, it is being paid off within a week).
I called Chase (who had my previous car loan) and the BK gal (SUPER NICE) said they haven't reported the car loan as current on my credit report because I was an asset case, so it won't change status until August. This actually worked in my favor.
Off I go to the next Toyota dealer. They pulled credit, same score. I "forgot" to mention the reaffirmation, remembering what the last dealer told me. He tried to tell me the interest rate would be 12.99%. I showed him the printout from my CU showing 7.49% with my credit score. He asked if Toyota Financial could offer that rate, would I be willing to go through them? Sure!
Bought the car, put $2500 down. Pretty easy process. I had to give seven references (three family, four non-family), plus provide two months pay stubs, a utility bill in my name and my cell phone bill. They ended up sending my loan to Wells Fargo.
Moral of the story... car buying right after BK can be done! With everything in the BK process, you have to do your research, plan carefully and plot your moves in advance. The car I had reaffirmed had a 9.49% interest rate (I bought three years ago with a 730 credit score). Supposedly it was because it was an older car.
If I can get to a 650 credit score, I can refinance with my CU at 5.24% (with a interest rate discount for the car being a hybrid). Love it!
Pre BK filing, I had a 690 credit score. After filing, I did the plunge to the high 5's/low 6's (depending on the bureau). I was discharged at the end of April. Right before discharge, I went to my CU and got a $500 secured VISA. No annual fee, 15% interest rate. I charge $25 a month on it so it reports and pay it off monthly. I think this helped my score a lot.
I went to look at a new Prius. The dealer pulled credit... 648! To qualify for zero percent financing, you need a 650 (Tier 3 with Toyota Financial). He noted I had two "repos" on my credit report. I told him I was doing a ride through on my motorcycle and had another car loan I reaffirmed. He said they would NOT give another car loan if you had a reaffirmation. (My parents were buying my old car that I had reaffirmed, so although it was reaffirmed, it is being paid off within a week).
I called Chase (who had my previous car loan) and the BK gal (SUPER NICE) said they haven't reported the car loan as current on my credit report because I was an asset case, so it won't change status until August. This actually worked in my favor.
Off I go to the next Toyota dealer. They pulled credit, same score. I "forgot" to mention the reaffirmation, remembering what the last dealer told me. He tried to tell me the interest rate would be 12.99%. I showed him the printout from my CU showing 7.49% with my credit score. He asked if Toyota Financial could offer that rate, would I be willing to go through them? Sure!
Bought the car, put $2500 down. Pretty easy process. I had to give seven references (three family, four non-family), plus provide two months pay stubs, a utility bill in my name and my cell phone bill. They ended up sending my loan to Wells Fargo.
Moral of the story... car buying right after BK can be done! With everything in the BK process, you have to do your research, plan carefully and plot your moves in advance. The car I had reaffirmed had a 9.49% interest rate (I bought three years ago with a 730 credit score). Supposedly it was because it was an older car.
If I can get to a 650 credit score, I can refinance with my CU at 5.24% (with a interest rate discount for the car being a hybrid). Love it!
Closed 2/2/11
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