life after bankruptcy
Life After Bankruptcy
Rebuilding your life after bankruptcy, including your savings, credit rating, and your financial and emotional well-being can seem tough. This article will provide some tips to help you overcome this challenge and get back on track.
Life after bankruptcy requires a lot of patience and planning. You need to manage and keep track of your every expense in order to recover from it. After bankruptcy, you may have to pay higher rates of interest, and getting a loan of any kind would be extremely difficult. Financial institutions that do lend you money will charge exorbitant rates of interest. You may be unable to procure a credit at all for major purchases, such as cars or home.
A lot depends on the type of bankruptcy you file under Chapter 7; the effects of bankruptcy are likely to continue for ten years since the event. However, under Chapter 13, your credit report is invalidated after just seven years. It is advised that you consult your attorney for details regarding your particular situation. Here are a few tips that will help you can get back to a good position, financially.
- Keep Track of Your Credit Report: It is not unusual to find errors in a credit report. Go through all the minute details carefully, and correct all the errors. Keep track of all the debts due, and those which have been cleared. Ensure that your credit report is modified with the correct information and kept up-to-date.
- Pay off your Current Bills: Pay your bills on time, as and when they come. It is very important to have your present credit record clear of any pending payments.
- Financial Advisors: Take help from a financial advisor to chalk out a complete financial/retirement plan.
- Save for a Rainy Day: Always keep appropriate cash reserves for unforeseen events. Find a proper insurance plan to protect your assets. Do not invest in anything that is not financially safe or secure.
- Financial Literacy: You can always gather and read good books for personal financial advise.
- Start Living a Productive Life: Get a job immediately, if you don't already have one.
- Pay in Cash: Do not use credit cards to pay for the items you purchase for your daily living. Pay for the items in cash or with a debit card. If you do use a credit card, ensure that you pay its bills on time.
- Check Interest Options Annually: The older the bankruptcy discharge, the better the interest rate will be. So review your loan interest options annually, if you are in the need for a loan. This option is only for those who have a record of making payments on time for all their present outstanding debts.