How to Buy a Car After You Go Bankrupt

Going bankrupt influences financing options; if trying to buy a car after filing for bankruptcy, you'll need to take specific steps and apply with certain auto lenders. Acquiring financing after bankruptcy can actually help rebuild your credit score. Auto lenders report payments made on the car loan, and paying on time each month can add points to your overall rating.

Instructions

1

Save for a down payment to lower the monthly payment. High interest rates are standard with car loans after a bankruptcy. Because higher rates increase the payment, aim for a 20 percent down payment to help keep your auto loan payment affordable.

2

Go to a subprime lender to acquire financing. Bad credit or subprime lenders are accustomed to working with people who have a past bankruptcy, repossession, foreclosure or other credit issue. Use these lenders to get a car loan with easy financing.

3

Show pay stubs to prove that you can afford the vehicle. Enter the dealership or lender's office with copies of income statements to qualify for the vehicle loan.

4

Ask about a cosigner for the loan. Buying a car after going bankrupt is easier if you have another person on the auto loan agreement with you. An appropriate cosigner is someone with a high credit rating (700 range or higher).

5

Wait until you're ready. If you don't have a cosigner or down payment to help you buy a car after going bankrupt, defer the purchase until you've improved your score. In the meantime, pay your outstanding balances on time and resolve to eliminate balances.