Life After Bankruptcy

It's all about getting a fresh start!

Bankruptcy is all about getting a fresh start. While you may feel bankruptcy only happens to the working people, there are many well known and successful people who have filed bankruptcy including former presidents, movie stars, television personalities, singers, sports figures, and inventors. The list includes Abraham Lincoln, Henry Ford, Mark Twain, Donald Trump, P.T. Barnum, Henry Heinz, Milton Hershey, Tammy Wynette, Larry King and Walt Disney to name a few. For them and for you, bankruptcy may be a life altering event, but it isn’t the end. Instead it is the beginning of a new start.

To assist you in rebuilding your financial security, here are some tips.

Important Steps to Rebuilding Your Financial Security

Maintain a Job: Demonstrating your ability to keep a job will show lenders and landlords that you are reliable and stable.

Pay Your Bills: A clean credit record following bankruptcy will encourage creditors to issue you a credit card or lend you money.

Keep a Bank Balance: Maintaining a positive balance in your checking and/or savings account will show creditors that you have a reliable cash flow. Have contributions to a savings account withdrawn automatically from your paycheck. Save it before you spend it.

Join a Credit Union: Their mission is helping members financially and they may be more willing to finance a car loan – especially if you are a member in good standing.

Live On Cash: Start learning to live within your means. Prepare a monthly budget, pay cash for everything and establish an emergency fund.

Check Your Credit Report: Make sure the discharged debts are noted as discharged. Then get a copy of your report, which is free, once each year to check for accuracy.

Rebuild Your Credit: This may be difficult and it may take time, but it can be done. You may only qualify for a low-limit credit card at a high interest rate but if you use your credit responsibly and pay off your balance monthly, you will begin to establish a solid payment history and earn the right to increase your spending limit and reduce your interest rate.

Get a Co-signer: You may need a co-signer to obtain credit for expensive items. If you do not have a co-signer, you may need to save money until you can put a substantial down payment on the item and then request to finance the balance.

Be Responsible: If you managed to keep your home, paying your mortgage on time will improve your credit. If you managed to keep a credit card, you must make your payments on time and keep your balance well below the limit so as not to incur penalties or higher interest rates.

If you are a renter, there are landlords that will rent to you if you have filed bankruptcy. You need to search the internet for a list of landlords in your area.

As the saying goes, “time heals all wounds”. Once you prove that your financial life is order, your ability to obtain credit will improve dramatically.