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?

Answer
“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.”
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Eric Schad
Answered on Aug 10, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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