No Cosigner, No Collateral – Get a Car Loan after Bankruptcy

Why do you think parents, financial advisers, and wise friends advise you against it? It drags your creditworthiness down for years and you have to work hard to get over it. But, even if you have lousy credit for whatever reason, you do not have to offer collateral or get a cosigner to find a reasonable auto loan. Of course, if either of those are available, they could certainly help your situation.Why? High Interest RatesBankruptcy can mean a lot of things, among them is the reality of high interest payments. No matter what kind of loan you seek, from an auto loan to a mortgage, the larger part of your deal will be paying interest, not the cost of the car or the property. You might want to think about laying low for awhile. You can save up some cash and start improving your credit rating by taking out small loans and repaying them successfully. Some seeking to improve their credit take out small loans, put the loan in an account, and have funds drawn from that account automatically pay off the loan every month.Cars Are a NecessityIf using public transportation for awhile is not an option, there are lenders willing to take a risk on poor credit borrowers, even those with bankruptcies. Lenders recognize the market for borrowers who need transportation. But, even if the loan manager at a car dealership turns you down, you can find lenders, especially in the online lending community. Indeed, rates and terms you find there will more often than not be better than you will get while waiting and sweating in a dealership loan office.Online Lenders Offer a Shopping OpportunityFire up your computer and punch bad credit car loan into your favorite search engine and you will be rewarded with any number of vendors. Some sites are actually shopping sites that let lenders bid for your business once you apply, usually within minutes. Again, your rates will be higher, but because of the competition, you will get to choose the best loan for the cost. And, believe it or not, the market is so large and the competition so fierce, you may be able to finagle financing close to what good credit borrower could get. Also, if you pay regularly on the loan, at some point you may even be able to make a plea for better terms.Collateral or Cosigner Could Cut RatesIf it is not too difficult, coming up with a cosigner could help you save a lot of money on interest – a lot. Your cosigner needs to have decent credit scores and good time at a reasonable job. The cosigner will be completely responsible for the remaining amount of the loan if you default – so do not. Should you happen to have valuable property at your disposal, a home or other real estate, you could save substantially by offering that as collateral.Wealth on Wheels?Sometimes, with a substantial down payment, a lender could consider the car itself as collateral and offer you better rates and terms. You would have to feel good knowing that, in spite of your bankruptcy, you are driving around in a pretty decent car and building up your credit rating simultaneously.