How to get a car loan after going through bankruptcy in Oakville

How to get a car loan after going through bankruptcy in Oakville

Posted on September 8, 2022

Most certainly, if you are reading this, you have filed for bankruptcy or are in the process of doing so.

Our Oakville car loans team are going to discuss what to do if you want to purchase a new vehicle following going through bankruptcy.

We are aware that this is a sensitive topic, particularly because nobody wants to discuss their financial difficulties.

Bankruptcy can give you a new financial lease on life but it comes with unique challenges

Bankruptcy used to be viewed as the end of a person's financial existence and something from which they could never bounce back.

People can now start over thanks to these laws. Anyone who believes they cannot file for bankruptcy is mistaken.

Anyone could file for bankruptcy since the average Canadian is only $200 away from financial difficulty.

Your trustee will provide you with a document that serves as your official discharge once your bankruptcy is over.

You cannot legally take on any additional debts without this document.

You can begin to rebuild your credit after receiving the official documentation stating that you are no longer responsible for the debt.

Why improving your credit is crucial and needs to be done as soon as possible

Although the bankruptcy would have released you from having to repay your debts, it will still be included alongside the bad debts on your credit record for up to seven years.

Any prospective lender would be wary of extending you any new credit until you have demonstrated your ability to manage your money wisely.

You must apply for secured credit products in this circumstance, such as those provided by HomeTrust and Capital One Bank.

These secured credit facilities, which will enable you to begin raising your credit score, are assured to be accepted.

Your credit score may need a few months to rise above 620, the required minimum for the majority of traditional credit products.

Adjusting your car purchasing budget

By attempting to raise your credit score, you've already made a significant first step, but there is still a lot more to do.

You should concentrate on your budget while you wait for an improvement in your credit score. Do you know how much cash you have each month left over that you could put toward your new vehicle?

Without factoring in insurance, maintenance, or gas, a car payment might easily reach $700 per month.

For all of your car-related expenses, you should strive to save at least $1,100 to be safe.

Your bankruptcy should have eliminated all of your debts, leaving you with plenty of cash to purchase a new vehicle.

Obtaining a car loan in Oakville after declaring bankruptcy

You are still not safe from harm. After filing for bankruptcy, you'll need professional assistance if you want to receive a good auto loan.

The best course of action is to speak with local auto lots that assist drivers with bad credit like you in obtaining a car loan in Oakville.

To ensure that you never again have to worry about paying exorbitant interest rates, these dealerships will also demonstrate to you the quickest and most straightforward technique to raise your credit score.

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