Common Questions About Bankruptcy Car Loans
We always strongly recommend that you first check with your bankruptcy attorney before doing anything related to your bankruptcy. But if you have questions about bankruptcy car loans, we have answers! Day One has been working with bankruptcy filers for years to find them the loan they need for a car purchase. We’ve heard all the questions customers ask, and now you can read the answers right here!
THE TOP 10 QUESTIONS ASKED BY DAY ONE CUSTOMERS
How soon can I get a new loan?
At Day One Credit, filling out our auto loan application takes less than five minutes. And then you’ll have our answer in just minutes!
Do I have to wait until my BK is discharged?
Many bankruptcy filers think they have to wait some magical period of time before they try to find a car loan or wait until the BK is fully discharged. Not true! As soon as you file your bankruptcy and have a case number (Chapter 7) or confirmed repayment plan (Chapter 13), you can apply!
Do I have to put any money down?
While making a down payment is always a good idea if you can do it, we understand that many of our customers can’t, which is why we do not require it. We work with many lenders who have no-money-down programs.
What will be my payment?
Your monthly payment depends on factors such as the price of the vehicle, your down payment (if any), length of the loan, and the interest rate.
What will be my APR?
Your interest rate and APR vary greatly because they depend on many factors, including your credit, the vehicle’s age and condition, the length of the loan, and more. To figure out your rate, fill out our quick finance application and we will get back to you in minutes!
Am I going to get a better rate if my BK is discharged?
Maybe, but it depends. If you took specific actions while your BK was open (3-4 months on average for a Chapter 7, 3-5 years on average for a chapter 13) to improve your credit or save up money for a down payment, you might get a slightly better rate. But many people simply can’t wait to get the car they need, and waiting may not make much of a difference at all. We can also often offer you even better financing if your bankruptcy isn’t yet discharged.
What kind of car and amount financed I can get?
There are no restrictions on the type of car you buy, except that you have to be able to afford it! Affordability depends on your payment-to-income and debt-to-income ratios, which are what lenders look at when evaluating your application.
Can I refinance my loan and would there be any penalties?
Day One doesn’t do straight refinancing deals. Our lending programs are designed for purchasing a high-quality used car.
What is a Fresh Start Program?
Bankruptcy laws were designed to help people get out from under crushing debt loads and make a fresh start. A Fresh Start Program means a loan program designed specifically to help consumers get the credit they need even though they have filed for bankruptcy. At Day One, that means getting a car loan in spite of a bankruptcy with our specialized network of lenders.
Can you refer me to a good bankruptcy attorney?
Yes! You can find experienced bankruptcy attorneys on our attorneys page to get the help you need!
QUESTIONS ABOUT TIMING
Do I have to wait until my Chapter 7 Bankruptcy is discharged?
Many Chapter 7 Bankruptcy filers think they have to wait some period of time before they try to find a car loan or wait until the bankruptcy is fully discharged. Not true! As soon as you file your Chapter 7 Bankruptcy and have a case number, you can apply!
Do I have to wait until my Chapter 13 Bankruptcy is discharged?
Many Chapter 13 Bankruptcy filers think they have to wait some amount of time before they try to find a car loan or wait until the bankruptcy is fully discharged. Not true! As soon as you have your Chapter 13 Bankruptcy confirmed payment plan, you can apply! NOTE: You will also need to get authorization from your trustee or judge before you can incur the new debt.
If my bankruptcy is discharged, do I have to wait two years?
Many people have heard that lenders want to wait two whole years after a bankruptcy is discharged before they’ll consider making a loan. That may be true for some lenders, but not for Day One lenders! The day your bankruptcy is discharged, you can apply!
How soon can I get a new loan?
At Day One Credit, filling out our auto loan application takes less than five minutes. And then you’ll have an answer from us in just minutes!
QUESTIONS ABOUT TERMS AND RATES
Do I have to put any money down?
While making a down payment is always a good idea if you can do it, we understand that many of our customers can’t, which is why we do not require it. We work with many lenders who have no-money-down programs.
What will be my payment?
Your monthly payment depends on factors such as the price of the vehicle, your down payment (if any), length of the loan, and the interest rate.
What will be my APR?
Your interest rate and APR vary greatly because they depend on many factors, including your credit, the vehicle’s age and condition, the length of the loan, and more. To figure out your rate, fill out our quick finance application and we will get back to you in minutes!
Am I going to get a better rate if my BK is discharged?
Maybe, but it depends. If you took specific actions while your BK was open (3-4 months on average for a Chapter 7, 3-5 years on average for a chapter 13) to improve your credit or save up money for a down payment, you might get a slightly better rate. But many people simply can’t wait to get the car they need, and waiting may not make much of a difference at all. We can also often offer you even better financing if your bankruptcy isn’t yet discharged.
QUESTIONS ABOUT OUR CARS
What kind of car and amount financed I can get?
There are no restrictions on the type of car you buy, except that you have to be able to afford it! Affordability depends on your payment-to-income and debt-to-income ratios, which are what lenders look at when evaluating your application.
Why should I buy a used car?
The goal is to buy a used vehicle because you get more bang for your buck if it’s a newer car with fewer miles. They’re way cheaper than buying brand-new and will cost you less in the long run.
What is going to happen with my old car?
If you owe more on your current car than it’s worth, talk to your bankruptcy attorney about your options for surrendering the vehicle back to the lender and how that works.
OTHER QUESTIONS ABOUT BANKRUPTCY CAR LOANS
If I signed a reaffirmation agreement can I still get a new loan?
Yes, you can! When you signed a reaffirmation agreement, all it meant was that you were committing yourself to continued payments on your vehicle’s loan. But you still have the freedom to sell that vehicle and get another if you can qualify for the new loan. That may be difficult if you owe more on your vehicle than it’s worth (being “underwater” or “upside-down” on the loan), but we’ve successfully helped many customers with this exact situation.
Can I get out my current underwater car loan?
Bankruptcy might include helping you get out of an “underwater” car loan, but you need to check with your bankruptcy attorney to find out your options. And if you need to finance a used car purchase during or after bankruptcy, Day One will help you find a bankruptcy car loan to meet your needs.
Can I refinance my loan and would there be any penalties?
Day One doesn’t do straight refinancing deals. Our lending programs are designed for purchasing a high-quality used car.
What is a Fresh Start Program?
Bankruptcy laws were designed to help people get out from under crushing debt loads and make a fresh start. A Fresh Start Program means a loan program designed specifically to help consumers get the credit they need even though they have filed for bankruptcy. At Day One, that means getting a car loan in spite of a bankruptcy with our specialized network of lenders.
Can you refer me to a good bankruptcy attorney?
Yes! You can find experienced bankruptcy attorneys on our attorneys page to get the help you need!
Attorneys We Recommend
We’ve worked with these bankruptcy attorneys and highly recommend any one of them!
