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Is 15% APR on a car loan high after you're discharged from Chapter 7 bankruptcy?
I just got discharged from Chapter 7 bankruptcy due to my disabled daughter's medical bills. However, I still need a car to get to work after my previous one died. I did the paperwork and the dealer offered me 15% APR on a 60-month car loan. Is this rate too high?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“The only way to truly know if 15% APR is too high after Chapter 7 bankruptcy is by shopping around, just like you would with
car insurance
. Banks and credit unions are the obvious places to start, but dealers may also be able to offer a better rate. Is 15% APR too high for your situation? Probably not. You’re a higher risk to lend to due to your bankruptcy. In many ways, you’re lucky that anyone is willing to offer you a loan at all. It’s a hard situation to be.
Keep in mind that a
car loan
at this rate will all but guarantee that you’re upside down on the car loan
for nearly the entirety of the loan, so put that into consideration as well. You’ll also need to get full coverage when you finance a vehicle. Lenders require full coverage to protect their asset. Full coverage can be pricey, especially if you use the lender’s insurance, but you can save money by comparing rates. Using a smart comparison tool like
Jerry
makes the process easy. Jerry does all the hard work for you, pulling quotes from the top 50 companies and delivering the best deals to your phone in minutes. Good luck. It’s hard, but not impossible, to make financial strides in the right direction.”
View full answer
- Gregory R.
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