Your car is repossessed, but you still need a vehicle. Obviously, you can buy any car you’d like if you save up the money yourself. However, that may take far longer than you have, especially if the lack of a vehicle is keeping you from getting to work and earning money. Can you get financing again?
You can, but it may be harder than it was in the past. A few things you can do to help include:
— Saving up money for a solid down payment. Your odds of being approved for the loan go up as the amount you have for a downpayment increases.
— Fixing your credit. Maybe you have minor debt on credit cards or short-term loans. Paying these off can help to repair your credit and reduce your debt load, helping you get another loan.
— Choosing a cheaper car. Sure, you may want that $50,000 BMW, but you’re more likely to be approved for a used Honda that costs $15,000. Remember, lenders lose money when they repossess a vehicle, so they want the lowest amount of risk if they think there’s a good chance that will happen again.
Having a car repossessed can have a serious impact on your life and your finances going forward. While you may be able to get another car, it can be difficult and the process can be frustrating. If threatened with a repossession, you need to know your rights — especially if you think that there has been an error and the car should never have been reclaimed.
Source: AutoTrader, “5 Tips for Getting Financed After Repossession,” Russ Heaps, accessed March 03, 2017
