What you need to do when trying to buy an electric car post consumer proposal

What you need to do when trying to buy an electric car post consumer proposal

Posted on September 16, 2022

In general, consumer proposals are preferable to bankruptcy because they only negatively impact your credit score for up to four years, whereas bankruptcy negatively impacts your credit for up to seven.

A bankruptcy trustee will be hired by you when you go through a consumer proposal.

This person will speak with all of your creditors in an effort to reduce the total amount you owe and extend the time you have to pay it back.

These creditors will negatively reflect you on your credit record because they have to wait longer and receive less money than they should have.

This is just something that happens when you submit a consumer proposal; it's not a personal assault.

How to get back up and running following a client proposal

Following a consumer proposal, you can recover by following some simple actions. You can't, for instance, take on further debt until the proposal is done.

There is no way around this rule.

After receiving approval from your insolvency trustee, you should apply for a secured credit card. HomeTrust offers this option as well as a Koho credit builder program.

The secured credit facilities will send monthly reports to TransUnion and Equifax.

Your credit score will increase if you pay these facilities on time and you will establish a solid track record of repaying bills.

If you heed this advice, your credit score will almost certainly rise even if it can take three to six months for this work to start to pay off.

Estimating your budget for a new vehicle

Determine how much you can afford to spend each month on a new electric car. While the monthly payment amount is crucial, you should also consider how long the loan will be outstanding.

You will eventually have to pay more interest the longer it takes to pay off.

A car loan in Canada typically lasts for five years, although the length of the loan depends on your credit rating, the interest rate, and the amount you are borrowing.

It can be challenging to determine what you can and cannot afford if you don't have a budget.

Try to save additional money for gas; with gas prices skyrocketing, you'll be happy you have money saved to meet these supplemental costs.

Where to proceed after a consumer proposal to get accepted for an EV loan

Although it is not a good idea, you may theoretically try to obtain a loan from an internet lender.

In this situation, you should get in touch with local dealerships that have knowledge in approving car loans for those with bad credit.

The dealership will be familiar with all Canadian lenders, including those that offer the most lenient terms for borrowers with poor credit.

Why not give a local dealership a call right now to get things rolling? These dealerships can bargain on your behalf and turn a potential "no" into a firm"yes."

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