Buying A Car
After Bankruptcy?
If you are
buying a car after bankruptcy,
here are a few suggestions that
could help:
First, you
should make sure you've done
everything you can to increase
your credit score. Once you've
done that you're ready to start
shopping for your car! Here's a
question for you: Is it better
to get outside financing or get
financing through the dealership
when you are buying a car after
bankruptcy. The answer is...
drum roll please... it depends!
It's worthwhile
to apply for outside financing
when buying a car after
bankruptcy. But make sure you do
it through the right lender. If
you don't, you could end up
paying $100s or $1,000s more in
extra interest. You also might
never get approved. Now let's assume
you've done your homework. You
found the car you like, you know
how much that make and model
sells for, and you know how much
your trade in is worth. It's
time to visit the dealership...
Let's say you
find the specific car you want
to buy. Now you're going to need
to negotiate the price. If you lined up
outside financing, then you're
in a good position from a
negotiating standpoint. But what
if you could not get outside
financing for a car after
bankruptcy? What if you need to
depend on the dealership to get
you financed when buying the car
after bankruptcy?
Many people
think that since they had a
bankruptcy they are at the mercy
of the car dealership in this
situation. THIS SIMPLY IS NOT
TRUE!
Let me share a
little secret with you: If the
dealership has run your credit
report and they start
negotiating with you, then
they're pretty sure they can
finance you. After all, do you
really think they would waste
their time negotiating a price
with someone they did not think
they could finance? Of course
not!
Here's where
things get interesting. How many
times a year does the dealership
negotiate with buyers? Probably
hundreds of times a year at a
decent sized dealership. Now
what about you - how many times
do you negotiate for a car? If
you are like most people, it's
probably once every so many
years.
Most people will
thoroughly research the price of
the car they want to buy. If
it's new they'll take time to
find out the dealership's cost
and, if they have one, the value
of their trade in.
...and they'll
go back and forth with the
dealership for two or three
hours until everyone agrees on
the numbers and a sale takes
place.
Chances are the
buyer still may have left a pile
of money on the table - and
didn't even know it. The reason
the buyer probably left money on
the table is that they more than
likely have made two critical
mistakes without even being
aware of them. One mistake was
that they didn't negotiate all
five parts of the sale
separately. The price of the car
is just one part.
On that note,
another step you will want to
take is to improve your car
buying skills. How? Visit
websites that provide car buying
tips. Another way is to pick up
a good book on how to buy a car
- you can find quite a few of
them out there. Unfortunately, I
have not run across any that
provide specific information on
buying a car after bankruptcy.
However, After Bankruptcy Credit
Solutions does cover this topic
in detail - so the information
is out there.
Other than a
home, buying a car is one of the
bigger purchases you're going to
make. You need to AVOID any
mistakes that can cost you up to
$100s or $1,000s of dollars in
extra interest. In other words,
you simply can't afford not to
get things right when you're
buying a car after bankruptcy.
This article
has covered some of the steps you can take
buying a
car after filing for bankruptcy. Put
these steps to use and they could save you
from making some expensive
mistakes!
Beware Of
Lenders!
There are many
finance companies online
competing for your business, to
finance your vehicle. Beware of unethical lending
practices. People with bad
credit are often prey to lending
scams. Bad credit borrowers have
fewer lending options than other
borrowers and some finance
companies take advantage of that
fact. Here are 3 things to do to
protect yourself from an
unethical auto finance company.
1. Compare Rates
Among at Least 3 Different
Lenders Online - If you have 3
or more loan offers to compare,
you are much less likely to take
an offer from a lender who is
charging excessive interest
rates. If you have 3 or more
interest rates to compare, you
will have a good idea of what
the average interest rate is
that is being offered to people
with credit problems for auto
financing.
2. Get Financing
BEFORE you visit a dealer - If
you are going to buy your car
from a dealer, make sure you get
your financing before you
actually visit the auto
dealership. Dealers and lenders
often make agreements to work
together to charge the borrower
a much higher interest rate than
they could otherwise get by
shopping around. If you have
your financing ahead of time,
you won't have to accept the
financing they offer you there.
3. Apply with
reputable lenders - If you are
applying with lenders who are
established and reputable, you
minimize your chances of being
taken advantage of.
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