Question 5: How much do you have for a down payment?

It will be necessary in most cases to be able to come up with a down payment or deposit. So start saving! Lenders don't take food stamps, or post-dated checks.

As a general rule of thumb, if you made all your payments as agreed on your last car, you should plan on no more than $500 to finance a new car at a normal interest rate...that is IF you follow what I teach in the free Credit After Bankruptcy seminar.

On the other hand, if you missed or made late payments on your last auto loan, your only option will most likely be 20% down at a high interest rate through a finance company.

If a car dealer is telling you to come up with more money, you're either at the wrong dealer...or you need to wait until you've reestablished your credit a little more.

If you want a good secured credit card-plan on depositing around $250 to $500. There are some secured credit cards that you can get that have lower deposits, but I don't recommend them. Most of the lower-deposit cards have hidden fees...don't report to the credit reporting agencies properly...and usually have higher interest rates to boot.

A down payment on a home will obviously depend on the amount of the mortgage. Although 3% to 10% of the purchase price is considered the norm-it's more than possible to get a mortgage for no money down. And I'm not talking about some crazy television infomercial that's promising you the world. I'm talking about real, bona fide mortgage programs.

So be prepared. Have a little money down to show you're a playa.

Question 6: What are your credit scores?

Of course you knew this was coming, right?

Back when I was recovering from bankruptcy, credit scoring was just starting to become popular. You couldn't even purchase all 3 of your credit scores before 2003.

Today credit scores are used by nearly every lender in the United States and Canada.

If you don't know your FICO credit scores-you should.

Most important, you need to know which credit reporting agency has your...

...HIGHEST credit score ...your MIDDLE credit score ...and your LOWEST credit score

To gain the most leverage over any lender you should choose to work with the lender that uses the credit reporting agency that has your HIGHEST FICO score. This way you receive the lowest interest rate and best terms.

A Final Note

So there you have it. The six questions lenders will ask you after bankruptcy. Like my scoutmaster taught me many years ago...be prepared.

Chance favors a prepared mind.

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