Castle Law Office Blog | Missouri & Illinois Bankruptcy Legal Blog

Getting Car Loans with a Foreclosure on Your Credit in St. Louis, Missouri

While it is clear that a foreclosure may have a negative effect on your credit report, it is not always clear what exactly that means. Can you still buy a house? Can you still buy a car? Well, it isn’t as simple as just being able to buy a car or home; it is about the conditions under which you can secure a loan. With a foreclosure on your credit, most car lenders will still let you buy a car, but at a very inflated interest rate.

The maximum interest rate, as of the date of this post, in Missouri is 26% and Illinois is even higher. If you try to secure a loan with a foreclosure on your credit report, you will surely be charged close to the cap, if not the cap itself.
If you are thinking that bankruptcy has the same effect on your credit report, you may be mistaken. Filing Chapter 13 bankruptcy in Missouri and Illinois to get protection from foreclosure is usually considered a responsible move, despite the myths that tell you differently. It may, in fact, be easier to secure a car loan with a bankruptcy on your credit report than it would be with a foreclosure.

Now, is this always true? Probably not. There are always instances where lenders go against the grain, but if you can get protection from foreclosure and keep it off your credit report, why wouldn’t you? Wondering what else a Missouri or Illinois bankruptcy lawyer can offer you with Chapter 13 bankruptcy? Request a free copy of my Missouri and Illinois bankruptcy book, “Get Out of Debt: Secrets Your Creditors Don’t Want You to Know.”