High-risk borrower doomed to poor rate
Dear Terry,
I have just filed for bankruptcy (due to a subprime mortgage debacle) and I am in need of another car. How can I re-establish my credit to get a car loan without getting completely ripped off with an outrageously high interest rate?
— Daisy
Dear Daisy,
It’s likely that the only lenders who will offer you a loan will be those that specialize in high-risk borrowers — of which, by virtue of the bankruptcy, you’re now one.
I have seen interest rates from these places running to more than 20 percent. My best advice it to get the least expensive car possible, pay it off as quickly as possible, and then look for something better when your credit score improves.
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