880 Walkers Line, Burlington, ON, L7N 2G2
My Garage

How to Buy an Electric Car after Bankruptcy: 4 Essential Steps

How to Buy an Electric Car after Bankruptcy: 4 Essential Steps

Bankruptcy can help a person get a new lease on life, but it comes with a series of unique challenges that you will need to prepare yourself for if you want to come out on top.

 

If you need to buy an electric car after bankruptcy, these steps are going to help you get behind the wheel of a new sooner rather than later.

 

EVs are expensive right now so you’ll probably need financial help to be able to afford one.

 

Bankruptcy is a second chance but with conditions

 

When your insolvency trustee files for bankruptcy, all of your creditors are notified are forced to accept whatever you can afford to repay them, which in some cases is just pennies on the dollar.

 

The creditors write off this as a bad debt, but you do not get off scot free.

 

The creditors will record derogatory comments with both credit reporting agencies, TransUnion and Equifax. These derogatory comments will stay on your credit report for up to seven years, so it makes securing a car loan very difficult.

 

Essential steps you need to take when trying to buy an EV post-bankruptcy

 

You need to start rebuilding your credit; until your credit score improves, no one is going to grant you credit, especially in the uncertain times we are living in.

 

The process for rebuilding your credit is fairly straightforward; you will need to sign up for a secured credit card from Capital One.

 

A secured credit card is not the same thing as a prepaid card; with a secured card, if you make your payments on time and keep your overall credit utilization rate down, your credit score will start to improve.

 

Another credit product you should consider adding to the secured credit card is an installment loan.

 

The installment loan does not have to be large, Koho has a credit building program where you pay $7 a month for six months; this information is reported to TransUnion, which, combined with a secured credit card, will help your credit score improve.

 

Calculating your EV-buying budget

 

We have addressed the steps to take when rebuilding your credit; now the next step is working out your maximum EV-buying budget.

 

To determine this, simply take forty percent of your gross monthly income, minus all of your existing bills, which should not be much since the bankruptcy relieved you of your debts.

 

The amount that is left after you have subtracted your rent and basic bills is the maximum amount that can go towards a car payment.

 

You also need to account for insurance, fuel, and maintenance along with the car payment.

 

These costs can add up, so you need to have a healthy buffer.

 

How to get an EV car loan after bankruptcy

 

You have taken all of the necessary steps to rebuild your credit, but you still need an elelctric car today.

 

You can get a car loan, but you cannot secure it on your own; the only way you can get a car loan is by working with a car dealership in your area.

 

These dealerships know the EV market and all of the lenders that provide car loans, so they will be able to pick the one that is going to give you the best deal.

 

We’d love to help you buy an electric car after bankruptcy. Simply fill in the form below and we’ll get back to you ASAP! 

 

Thanks for reading. Be sure to connect with us on Facebook, Twitter, Instagram, or LinkedIn to stay up to date on our latest great articles! 

 

    Contact Us

    By submitting this information, you are accepting that it may be collected, used and disclosed as described in our privacy policy.
     

     

    Categories: EV motoring

    Tags: