One’s financial status can be tempestuous. One day you could be doing fine and make timely payments, while you may also be one crippling bill away from filing bankruptcy. While going bankrupt is eminently a troubling thought for many, especially for those currently under financial burden, even when bankrupt you can still commit to some financial dedication, such as buying a car.
We certainly understand that realistically speaking, you’d need a car in Canada to get to places that you need to be. That’s why that even when faced with financial adversities that we reckon a car still remains a daily necessity to get you out of a rut. However, owning a car even after bankruptcy needn’t be a stressful undertaking. That said, there are things that you should acknowledge about owning or purchasing a car post-bankruptcy.
Obviously, the worst thing about filing for personal bankruptcy is the fact that it will leave a lasting impact on your credit history. Some sources say that one out of six people living in Canada will file for personal bankruptcy at least once in their lifetime, which means that it’s not all too uncommon. Therefore, there are plenty of dealers and credit institutions out there that are dedicated to serving folks who are facing bankruptcy, and it’s not that much different to buying a car with bad credit.
It’s easy to be taken advantage of once you’ve filed for personal bankruptcy, and that is something that unscrupulous dealers like to take advantage of. Of course, for those who are already anxious about living every day, it’s easy to take the first offer one throws at you, even if it’s outrageous. It’s a misconception that once you’ve filed for bankruptcy that you lose bartering rights. Everything about buying a used car still stands even after filing bankruptcy, that includes shopping around and being shrewd.
Truthfully, you’re at a disadvantage, but it costs nothing to shop and ask around for the optimal offer. You’re likelier to be rejected when you make inquiries at dealers and lenders, and repeated inquiry can impact your credit. Thus, you should try your luck at dealerships that are familiar with lending to people with bad credit first, as they can most definitely sort you out with an agreeable deal.
Nevertheless, what dealers really care about isn’t your bankruptcy, but how good of a debtor you were prior to bankruptcy. If you’ve maintained a good track record paying off your car before facing bankruptcy, most auto lenders would still be glad to provide you with a loan. At this point, it’s also worth opting for a free online credit report check to know where you’re really at credit wise post-bankruptcy.
Since filing for bankruptcy erases most of your debt, it’s worth noting that very few folks lose their car due to bankruptcy directly. Since lawmakers understand that losing your method of transportation isn’t an option, all provinces have a law that exempt one vehicle worth up to a certain value from seizure by the debtee. Bankruptcy in Canada involves unsecured debt, and financed or leased cars are classified under secured debts, therefore you can still maintain your outstanding loan even after filing for bankruptcy.
If you are facing such an issue, get in touch with us. We are keen on helping those facing financial trouble out and getting them back on the right track. As long as you manage your expectations and play your cards right, owning a car while managing bankruptcy isn’t as daunting as it sounds.