Attempting to Re-establish Credit Soon After Bankruptcy
Trying to find credit after you file for bankruptcy has been reported for a long time as being extremely difficult, but it's not completely impossible. If you apply for credit, it is essential to make sure your lender is aware of a bankruptcy. A number of creditors choose to contemplate any reason for bankruptcy and often make allowances for particular reasons.
Sometimes the interest rates for those who have filed for bankruptcy are much higher than standard terms. This can make paying off the credit lent somewhat tricky. However, creditors typically don't mind because they also know there's a time limit clause in which you can claim bankruptcy again.
Certainly, if you go into default on the loan then you may be forced to pay and they could have the law on their side. So, a number of the high risk creditors have zero problem dealing with a consumer that has only recently filed for personal bankruptcy, as they know you will end up forced to pay regardless.
Due to the availability of credit being minimal after personal bankruptcy, it will be time to start rebuilding your credit. Remember that your bankruptcy will remain on your credit history for a decade and any positive notations made on the report will show upcoming creditors that you're taking the right steps to help get your financial life back. Several credit card banks may be prepared to take a chance on you fairly immediately after your bankruptcy, but the high interest rate may not be worth the effort.
You can also find companies who offer pre-paid credit cards which work similarly to your bank's debit card, but will as an alternative report your positive results to the credit bureau. You will need to open a merchant account with them and your available credit depends on the balance. You need to make monthly installments and maintain the initial balance in your account, but the appeal is your payments will be reported to the credit agencies helping you rebuild your credit.
It's really a good idea to start rebuilding your credit right away, after declaring bankruptcy. However, you should definitely do so in ways that doesn't make you end up right back in the sticky financial circumstances you were in before the bankruptcy process began.
There is absolutely no reason to plod through the complete bankruptcy process, only to discover yourself deep in financial trouble again. Talk with a financial advisor or even your bankruptcy lawyer to figure out what the best course of action is for you. They could likely offer you tips on how to responsibly restore your credit.
Sometimes the interest rates for those who have filed for bankruptcy are much higher than standard terms. This can make paying off the credit lent somewhat tricky. However, creditors typically don't mind because they also know there's a time limit clause in which you can claim bankruptcy again.
Certainly, if you go into default on the loan then you may be forced to pay and they could have the law on their side. So, a number of the high risk creditors have zero problem dealing with a consumer that has only recently filed for personal bankruptcy, as they know you will end up forced to pay regardless.
Due to the availability of credit being minimal after personal bankruptcy, it will be time to start rebuilding your credit. Remember that your bankruptcy will remain on your credit history for a decade and any positive notations made on the report will show upcoming creditors that you're taking the right steps to help get your financial life back. Several credit card banks may be prepared to take a chance on you fairly immediately after your bankruptcy, but the high interest rate may not be worth the effort.
You can also find companies who offer pre-paid credit cards which work similarly to your bank's debit card, but will as an alternative report your positive results to the credit bureau. You will need to open a merchant account with them and your available credit depends on the balance. You need to make monthly installments and maintain the initial balance in your account, but the appeal is your payments will be reported to the credit agencies helping you rebuild your credit.
It's really a good idea to start rebuilding your credit right away, after declaring bankruptcy. However, you should definitely do so in ways that doesn't make you end up right back in the sticky financial circumstances you were in before the bankruptcy process began.
There is absolutely no reason to plod through the complete bankruptcy process, only to discover yourself deep in financial trouble again. Talk with a financial advisor or even your bankruptcy lawyer to figure out what the best course of action is for you. They could likely offer you tips on how to responsibly restore your credit.