What is the maximum auto loan I can get after repossession?

An automatic repossession can make lenders uncomfortable, but you can usually get approved for a car loan after a year. Since you’ll likely need financing through a lender with bad credit, the maximum car loan you can get after repossession depends on several factors, such as your income and credit profile.

Car loans for repossessions

Repossession of your car can make it look like you won’t qualify for another car loan. In fact, a repo stays on your credit reports for up to seven years from the original default date, but its impact on your credit score diminishes over time.

You can get a car loan with recovery on your credit, but you’ll probably need to get financing from a subprime lender. These lenders are willing to work with car buyers with credit issues, but even they typically state that any repossessions must be over a year old before they’ll consider a candidate — and you can forget about being financed. if you have multiple repossessions on your credit reports. The only exception for most of these lenders is if the repo was included in a bankruptcy.

The main thing is that it is difficult to get approved for a car loan after repossession unless he is at least a year old. If a year hasn’t passed, we suggest you take some time to prepare for a future loan. You can do this by requesting your credit reports to make sure all information is accurate, working to improve your credit, saving for a down payment, and familiarizing yourself with typical subprime lender requirements.

If you can’t wait a year, another way to get auto financing is to buy here, pay here, at a dealership. These car lots are internally financed, which means they don’t use third-party lenders. They usually don’t check your credit and just rely on your income to qualify.

Max Car Loan after repossession

Obtaining an auto loan following a repossession usually means that you will need subprime financing. The bad credit car loan process works a little differently. To be approved, you must find a dealership with subprime loan relationships and discuss your situation with their special financial department.

Once you complete an application, they will forward it to their subprime lending partners. If approved, the lender sets the maximum monthly payment, as well as other loan terms, such as the interest rate and down payment requirement. So the maximum auto loan you can get after repossessing depends on many different factors, including the lender’s programs.

The three main factors that determine how much loan you can get are your income, your credit profile, and your debt-to-income ratio (DTI):

  • Income: Subprime lenders generally require a minimum monthly income of $1,500 to $2,000 before taxes. Of course, the more you earn, the bigger the car loan you can usually qualify for.
  • Credit profile: Your credit score is used to determine the loan program or level you qualify for, and where you are on the lender’s scale influences the loan terms you can get.
  • DTI Report: This calculation is found by taking the sum of your monthly bills and dividing by your monthly pre-tax income. The DTI ratio gives lenders a better idea of ​​how much disposable income you have to cover a car loan.

Bad Credit Repo Car Dealers

In most cases, you can obtain a car loan following a repossession after one year. Also, the maximum amount of auto credit you can get depends on many factors. We suggest you take a close look at your budget and focus on choosing a vehicle you can comfortably afford so you can use the auto loan to rebuild your credit.

If you need help finding a dealer who can resolve credit issues such as repossession, Auto Express Credit wants to help. We work with financing dealerships across the country and have helped thousands of people with bad credit find financing. Begin the process by submitting our online car loan application form today.

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