The first thing you need to do is find a lender that will finance you. You can try to get financed with a bank or credit union, but traditional lenders rarely work with bad credit applicants.Your best chance of getting approved is with a subprime lender. You can work with the finance manager at your dealership to select a vehicle that falls into your price range. Now, you need to get a sample financing contract or statement from the dealership. This will list information on the car you plan on buying, the price, loan terms, interest rate, monthly payment amount, etc.
Next, you need to take your sample financing statement to your court-appointed trustee. They will measure how much debt you're taking on against the potential impact it will have on your Chapter 13 repayment plan. You will be asked to complete some paperwork for the trustee. Most of it will deal with the reasons why you need a vehicle. You need to be able to show the court that getting the car is necessary. Your trustee will determine if the transaction is acceptable or not. Also, he or she could potentially make adjustments to your repayment plan if needed. Then they'll take it to court.
Your trustee will file your petition to incur additional debt with the court. This will be sent to the creditors and other parties involved in your Chapter 13 repayment plan. Therefore, they will be given the chance to object the motion. The final step: the court will make their decision. If your motion is approved, you can head back to your dealership. You can present them a copy of the court's order and move forward with the loan and car buying process.
