subject: CC Brown Law – Life after bankruptcy discharge – Rebuild your credit after bankruptcy [print this page] CC Brown Law Life after bankruptcy discharge Rebuild your credit after bankruptcy
In general, if you are one of the millions who have recently filed bankruptcy, you would understand that life after bankruptcy discharge is one of the most traumatizing and difficult phase of your life. Apart from all the mental agony and emotional turbulence, this also means a major financial setback in life after Bankruptcy discharge. The road to recovery from bankruptcy and rebuilding your credit after bankruptcy is pretty long and very difficult.
The first thing which you would need to do after bankruptcy is to meet with your creditors and let them know your situation. Any non-exempt assets which you have will be liquidated though you will be allowed to keep your car, furniture and personal belongings till a certain value. But all non-exempt liquid assets like cash or Certificate of Deposit must be handed over to court appointed trustee. This is one of the first issues which you will need to face after bankruptcy.
Another thing which you should remember is that it will be next to impossible to get any type of loan after filing for bankruptcy. For the first 18 to 24 months, it is not even worth trying to apply for any kind of loan whether it is car loan or home loan. The best way to come out of this situation is to improve your credit score. Even if a creditor or a bank agrees to lend you money, can be sure of getting it at a relatively high interest rate.
The best thing you can do to come out of this situation strongly is to rebuild your credit after bankruptcy. As I mentioned above, this is a long and difficult process therefore you will need to be firm in your decisions and stick to them.
Get a secured credit card This should be your first step. A secured credit card should be easy to get from a bank since it is secured for the bank. You need to deposit some amount with the bank which becomes your credit limit. Good thing about this credit card is that this will help you rebuild your credit history fast. Just make sure that application fees is zero and the bank will send your credit history to the credit bureaus.
Maintain the job It is very important to keep your job. If you don't have one, try to get it as early as possible. The employment along with your residence history shows your creditors that you are reliable person whom they can trust and give loans.
Pay bills on time Again very critical point. This becomes the building block of rebuilding your credit after bankruptcy. What utility or credit cards bills you may have, pay them off in time. Delay or missing payments of these can be disastrous.
Start using cash instead of card This is induce self discipline while shopping. Usually, we misuse our credit cards and buy things even if you don't want to since we can take them on debt using our cards. If you use cash, you will tend to buy only necessary items thus increasing your savings.
Keep track of your credit report As per law, you can get one free credit history report from all three credit bureaus. Keep a track of your credit. If you find any discrepancy, bring it to the bureaus as early as possible.
Rearrange your finances You should take a look at your monthly budget and realign it as per your new financial status. Keep focus on savings and reduce spending wherever you can. Try to take credit after about 1 to 2 years which will help you rebuild your credit after bankruptcy.
Thus, Life after Bankruptcy is hard and it takes determination and grit apart from just planning to rebuild your credit after bankruptcy. However, it is not difficult to take advantage of the fresh start that bankruptcy affords. So, the Consumers can use various strategies to put themselves in a position to rebuild their credit and can get the kind of interest rates that they are eligible for bankruptcy.
