341 two days ago. How long after discharge can you secure a decent car loan?

[overthedebt2]

Thank you for all your support here over the years. Don't know what I would have done with all the insight and good advice found here. It took me so long to take the plunge and move forward and I'm so relieved that the 341 has passed. Now the waiting period!

How long after the discharge can you secure a decent car loan? I have reaffirmed my 4 Runner at 6.5% with the hope that I can move in to something more fuel efficient. Most off the offers I'm seeing are upwards of 20% however. What is your experience in how long it takes to start getting better % offers?

Hoping the 60 day goes smoothly!

[justbroke]

The answer is so dependent on your pre-bankruptcy credit picture, that no one can tell you with any precision, on what the answer is.

If you had car loan issues prior to bankruptcy, they could will haunt you for years after filing. The reason is... most car lenders use the FICO Auto Enhanced scoring model which places greater emphasis on installment loans and more particularly car loans. So, if you paid late on your cars before filing, that will pull down your Auto score.

However, life doesn't end there. You just need to pay your bills on time, and re-establish some credit to help improve your overall score. Don't go crazy. Maybe one or two revolving cards (major credit card), and keeping the balances below 30% at all costs. Then, maybe, after 2 years, you'll start to see interest rates in the 6-9% range and you may even be able to get into Tier 2+ pricing (FICO 670+)... but that will require a good credit history.

[AngelinaCat]

Figure at least three--perhaps four--years post discharge to 'try' to get a decent rate. 'Hub tried to finance thru VW to get a decent rate to purchase a used VW Jetta TDI for me. He was turned down. That was October 2011. We were discharged 08/13/2008. His brother ended up financing the car for him.

When we went and talked to our service person at our CU, earlier this year, she ran our Credit Reports and got numbers averaging 680 for both of us. We explained what happened with the car, and she said: "Your scores are now good enough. Next time you need a loan for a car, come see me."

Which is reassuring, but still tells me that our scores are not yet truly high enough.

[Fallonedward]

My score was high prior to filing for BK and I am a year and 7 months past my BK discharge and I just secured a good rate but I feel it was because my score was so high prior to filing that even thou the BK dropped it it was able to come back quicker, if that makes sense.... So as Cat said it does depend on each individual. good luck

Figure at least three--perhaps four--years post discharge to 'try' to get a decent rate. 'Hub tried to finance thru VW to get a decent rate to purchase a used VW Jetta TDI for me. He was turned down. That was October 2011. We were discharged 08/13/2008. His brother ended up financing the car for him.

When we went and talked to our service person at our CU, earlier this year, she ran our Credit Reports and got numbers averaging 680 for both of us. We explained what happened with the car, and she said: "Your scores are now good enough. Next time you need a loan for a car, come see me."

Which is reassuring, but still tells me that our scores are not yet truly high enough.

[tobee43]

Figure at least three--perhaps four--years post discharge to 'try' to get a decent rate. 'Hub tried to finance thru VW to get a decent rate to purchase a used VW Jetta TDI for me. He was turned down. That was October 2011. We were discharged 08/13/2008. His brother ended up financing the car for him.

When we went and talked to our service person at our CU, earlier this year, she ran our Credit Reports and got numbers averaging 680 for both of us. We explained what happened with the car, and she said: "Your scores are now good enough. Next time you need a loan for a car, come see me."

Which is reassuring, but still tells me that our scores are not yet truly high enough.

will the CU refi the car for you??

[kornellred]

There is no such thing as a decent car loan to begin with, so forget about favorable APR's and other such effluvia. Walk in to any dealership and point to the car you want. You will get it. You will not like the price or the terms, but you definitely will get it.

[AngelinaCat]

will the CU refi the car for you??

We didn't even bring that question up. No, we don't want to re-fi away from the Bro. He and his wife were very generous to begin with, it would probably hurt SIL's feelings. Also, we are only paying $250.00 a month, and if we have to miss a payment for some reason or other, there is no problem. Fortunately, that situation hasn't arisen.

[basketsbears]

Hi,

This is something I don't quite understand. We have never missed nor been late on our car payments. We are not reaffirming our cars in our bankruptcy, and will probably return one vehicle. So with all that being included in bankruptcy, if we return one after, and keep paying on time on the one we didn't reaffirm, what happens to our auto enhanced score???? Also, both loans are with Ally financial.

Hope my question makes sense.

Thanks!

[jst4f]

We did not need a car following BK but there where many offers sent to us by the "bankruptcy departments" of several auto dealerships. We were pre approved according to the letters for up to x dollars toward a new car. They wanted to help us with our fresh start. Now I know they understand that I can't file BK for another 8 years so their risk is low and the interest rate would be high. But they would sell me a new car.

[overthedebt2]

Thanks for the feedback! We paid on-time (never late) for 3 loans through Toyota Financial over the years. We are current on the most recent loan and kept paying during the initial filing through the reaffirmation. So, from what I'm understanding, that will help? We had credit in the mid 700's prior to filing and paid off two previous loans through Toyota with no late payments.

jst4f: We keep getting those offers, too. Literally one a day. SUPER high rates.

[AngelinaCatHub]

Amazing

"341 two days ago. How long after discharge can you secure a decent car loan? "

It just amazes me that so many in C7 bankruptcy, a liquidation of debt and property, are so worried where they can get credit and at what terms. Bankruptcy means something. It is or should be a lesson. We have been out of bankruptcy now for a couple of years. We own no credit cards and but for my brother financing a second car he insisted on doing, we have do debt. I did not need to do this but I now can afford it as I have no debt. Things are not that important. Things and their false value gets us to the place we are. Bankruptcy. My opinion. 'Hub

[hmsmith]

Thanks for the feedback! We paid on-time (never late) for 3 loans through Toyota Financial over the years. We are current on the most recent loan and kept paying during the initial filing through the reaffirmation. So, from what I'm understanding, that will help? We had credit in the mid 700's prior to filing and paid off two previous loans through Toyota with no late payments.

jst4f: We keep getting those offers, too. Literally one a day. SUPER high rates.

That's great that you paid and have a positive history with Toyota Financial. I'm not sure if you've seen my posts but we were just discharged two months ago. My hubby has a car through this work and I reaffirmed my toyota lease only because I had 3 months left to pay on it and then I wanted to buy it out since it was so affordable and reliable. Well here I was with my lease ending and NO ONE would finance me or even talk to me since we are so recently out of BK. We have a strong income, rock solid job history and no debt, but they didn't care. 3 banks turned me down (well I never even filled out a credit app as I didn't want the hit on my credit when it sounded unlikely they would give me the loan). My last hope was toyota financial. I have even read on here somewhere that Toyota financial was not BK friendly so I didnt think they would be helpful. I called and spoke with my local toyota dealer (since we moved) and after explaining our situation and talking to the finance guy, I was approved over the phone!! Not only was I approved but my rate was 5.25%!!!!!!!!! I was so happy! He said that toyota looked back and saw that I made ALL my lease payments on time and that they want to keep us as a client in the future!! THANK YOU Toyota!! So I would def talk with them, they might help you out!!

[overthedebt2]

"341 two days ago. How long after discharge can you secure a decent car loan? "

It just amazes me that so many in C7 bankruptcy, a liquidation of debt and property, are so worried where they can get credit and at what terms. Bankruptcy means something. It is or should be a lesson. We have been out of bankruptcy now for a couple of years. We own no credit cards and but for my brother financing a second car he insisted on doing, we have do debt. I did not need to do this but I now can afford it as I have no debt. Things are not that important. Things and their false value gets us to the place we are. Bankruptcy. My opinion. 'Hub

Angelina,

I'm not suggesting I plan on taking on lots of new debt, much less credit card debt. I got moved to a job location 45 miles from my home and it costs me $300 extra in gas each month. I already have a vehicle that I've been paying on responsibly but sadly it isn't fuel efficient enough with a hefty drive each day. It makes much more sense to get a different vehicle but not at 20% interest. That's all I was asking.

Thanks

[overthedebt2]

That's great that you paid and have a positive history with Toyota Financial. I'm not sure if you've seen my posts but we were just discharged two months ago. My hubby has a car through this work and I reaffirmed my toyota lease only because I had 3 months left to pay on it and then I wanted to buy it out since it was so affordable and reliable. Well here I was with my lease ending and NO ONE would finance me or even talk to me since we are so recently out of BK. We have a strong income, rock solid job history and no debt, but they didn't care. 3 banks turned me down (well I never even filled out a credit app as I didn't want the hit on my credit when it sounded unlikely they would give me the loan). My last hope was toyota financial. I have even read on here somewhere that Toyota financial was not BK friendly so I didnt think they would be helpful. I called and spoke with my local toyota dealer (since we moved) and after explaining our situation and talking to the finance guy, I was approved over the phone!! Not only was I approved but my rate was 5.25%!!!!!!!!! I was so happy! He said that toyota looked back and saw that I made ALL my lease payments on time and that they want to keep us as a client in the future!! THANK YOU Toyota!! So I would def talk with them, they might help you out!!

Thanks for the info hmsmith! I'll keep that in mind. Appreciate your feedback.