How to get a car loan while in chapter 13?

Car dealership that works with chapter 13 near you in Indiana.

Indy Auto Man is a dealership that works with Chapter 13 near you in Indiana and provides car loan support for all categories of buyers. Having a low credit score or being in bankruptcy doesn't prevent you from applying for car financing. Below, we’ve collected tips on how to get approval in each particular case in Indiana.

Can I get a car loan while in Chapter 13 BK?

You can get an auto loan even if you're in the middle of bankruptcy or just finishing one. If you're still in bankruptcy, you need to contact your trustee to get a letter that explains the rules for your new auto loan, if approved. This document will include details like the highest interest rate, payment amount, and loan term. Most lenders will require this letter to follow court rules when giving you a loan during bankruptcy.

If a bankruptcy is completed, most lenders will simply look at the following items to qualify:

Your current credit score;
What types of credit were eliminated or reorganized as part of the bankruptcy;
Current monthly debts (minimum payment requirements) compared to monthly income;
The down payment amount.

Indy Auto Man has several lenders that work with customers going through or have completed a bankruptcy, so you can get approved even while in Chapter 13 BK or Chapter 7 BK.

Can I use my EIN to get an auto loan?

Indy Auto Man works with many lenders who can help you get an auto loan in your business name. If you want a loan only in your EIN ( (Employer Identification Number) and not as a co-signer, you usually need to have been in business for at least 3 years and have some credit history in your business name. Two lenders we work with, Ally Financial and Santander Consumer USA, offer this kind of loan. You can also include your personal information for titling, but the loan won't affect your personal credit.

If you're a new business or don't have much business credit, lenders may ask you to apply as a co-signer. This means they can use your personal credit score to qualify you while keeping the loan in your EIN. We have several lenders that offer this option.

For either type of loan, your sales consultant will need your EIN, the address where you want the vehicle registered, and some basic info about your business.

If you want to use an address other than what is listed with the Indiana Secretary of State, we will need 2 proofs of that address in the company name, dated within the past 30 days, such as:

Utility Bill
Cable Bill
Phone Bill
Bank Statement
Credit Card Statement
Mortgage Statement

Can I get a loan for a vehicle as a 1099 worker?

If you are an independent contractor and receive income in the form of a 1099, the documentation required will be fully dependent upon your credit score:

If your credit score is above 640, and you have had a good history with a previous car loan, most lenders won’t need to see your proof of income.
With scores between 600 and 640, you can expect some banks skip asking the proof, but they could charge you a higher interest rate.
If your score is below 600, most lenders will ask your proof of income, although some might not require it. Read how to raise your credit score.

If you work as a 1099 employee, most banks will want to see your tax return from the previous year.

Can I get a car loan with a low credit score?

Indy Auto Man Indianapolis dealership works with lenders who can supply you with an auto loan regardless of your credit score. We have gotten customers approved for auto loans well down into the low 400 credit scores. Read more about bad credit car loans.

The volume of paperwork the bank will need depends on your credit score and your history with car loans. Generally, if you have a higher score and a good loan history, the bank will ask for less paperwork, and sometimes they won’t need any at all.

If you have had delinquencies, collections, repossessions, or little to no down payment, the bank may ask for items such as:

Most recent paystub (to prove income);
Proof of residence (if your Driver's License doesn't match where you currently reside);
A phone bill showing your name, address, and current phone number;
References (names and numbers of a few close friends/relatives).

Will a down payment help me get approved for financing a car?

Down payments ALWAYS increase the chances of getting approval for an auto loan, regardless of your credit situation. The higher the down payment, the more likely the lender is to provide you with money for an automobile purchase. For example, we have a lender that will approve most reasonable credit situations, as long as you put 20% of the purchase price as a down payment. We have another financial institution that will waive proof of your income with 30% of the purchase price down. This is a good way for car financing for people with unique employment/income situations such as self-employment, someone who does side jobs, delivery service workers, etc.

Get in touch with the Indy Auto Man dealership today to discuss your financial statement, and together, we’ll work out the optimal solution for you to finance a car in Indiana.