Fear is a powerful thing. Fear motivates people and holds other back. It’s true, your life after bankruptcy may be different than it was before you went and made the best financial decision you’ve made recently. While its true that bankruptcy generally reduces your credit score, it’s likely that your credit was already not so great. Bankruptcy can occasionally make it harder to get credit in the future, especially in the short term, but over time things get better.
Fear of bankruptcy and its aftermath isn’t a good reason to avoid using it when you need it. Bankruptcy is there for a reason and that reason is to help you in your time of need. Bankruptcy can free up your finances and allow you to get through life without the need to take on more and more debt. With the financial freedom and stability bankruptcy provides, you may not even miss the credit lines you once had.
Recovery after bankruptcy: What happens next?
After a bankruptcy you’ll be considered, at least temporarily, a high risk borrower. Your best bet for rebuilding your credit is to make on time payments with your utility providers, especially cell phone and internet companies as they often report on your credit. With a Chapter 7 bankruptcy, you’ll have it reported on your credit report for the next 10 years and if you choose a Chapter 13 bankruptcy, it will stay on your credit report for the next 7 years.
While you may have trouble getting loans or credit, most people are able to get credit for some kinds of purchases after only a year or two.
While you’re in the bankruptcy process you’ll encounter some minor difficulties on occasion. You may find it harder to rent an a place to live, buy a car or get a job. If you already have a place to live and a good job or a reliable car, do your best to maintain the status quo. It could be difficult to get a car loan immediately after bankruptcy and while many landlords understand that people get in trouble sometimes, there are landlord who may exclude you if you have poor credit.
After bankruptcy, the key things to do is remember to pay all of your bills on time. Stay current on them so that your new post-bankruptcy record stays clean and shows positive change from the bankruptcy moving forward. You may want to take out a credit card that requires a full deposit. These are available at many reputable banks and are usually available to people regardless of their credit history. This kind of card is designed to help you build your credit on one hand and it also keeps you protected by not allowing you to borrow more than you put down as a deposit.
These are some things to think about with bankruptcy. We are always up front with our clients about he way their life will change. Your life may change after bankruptcy, but you will be able to move on and have a life without debt that overwhelms you. If you’re interested in scheduling a free consultation to discuss your options, contact the compassionate attorneys at Harmon and Gorove for a free consultation today.