Bankruptcy has helped many individuals out of difficult financial situations. However, knowing what life is like after bankruptcy can feel scary.
If you’re considering bankruptcy, it’s important to know what your credit situation will be like after the process is over. It’s also important to fully understand how bankruptcy will influence your future purchases and borrowing.
What Happes After Bankruptcy?
In most situations, filing for bankruptcy will not automatically disqualify you from borrowing money to purchase a house, a new car, or even just to open a credit card. However, your bankruptcy filing will still impact when you can borrow and how much you will be given.
If you’re considering bankruptcy, chances are you probably already have a low credit score. If you’ve frequently missed payments or have gone without paying back your creditors for an extended period of time, your score may not drop too much from filing bankruptcy.
However, you’ll still want to do what you can to repair the damage.
After filing for bankruptcy, it’s important to take the appropriate steps to rebuild your credit. To do this, you’ll first want to check your credit report to guarantee everything borrowed is accurate. If there is something on your credit report that doesn’t belong, dispute it immediately.
Once you know your credit score, you’ll want to work to start rebuilding. Add positive information, such as steady employment or even paying your bills on time. You can also apply for a secured credit card, which can help you build credit. A secured credit card allows you to put down a deposit as collateral. You can then “borrow” from the card and make full payments on time, helping your credit boost.
Filing for bankruptcy can essentially allow you to start from scratch rebuilding your credit. Rather than continuing to fight payments and creditors you can’t afford to repay, filing for bankruptcy can help you eliminate the debt holding you down so you can take control over your financial situation again.
To talk about your situation and whether or not bankruptcy is right for you, contact Michael F. Kanzer & Associates, P.C. today.