If you owe money to creditors and are behind on payments, you may receive phone calls regarding your past due amounts owed. If you feel overwhelmed with debt, and powerless to stop the harassment from your creditors, you may actually have a choice.
Bankruptcy can wipe out your debts and leave you with a fresh slate financially. While bankruptcy can clear your debts, it also damages your credit for seven to 10 years depending on which bankruptcy you filed. While your debts are discharged in a bankruptcy, having damaged credit can prevent you from getting a car loan or a new mortgage. If you are feeling anxious about life after bankruptcy, rest assured that there is good news ahead.
Your credit will initially take a horrible dive after bankruptcy, but almost immediately it will slowly start to repair itself. Creating a budget and sticking to it, can keep you on a financial track to not only build your credit but hopefully create a healthy financial lifestyle to prevent you from ever needing to file for bankruptcy again.
Live beneath your means, and make sure to cut any excess from your budget to ensure that you never have debts greater than income. Simplify your lifestyle and plan for any financial downturns, job losses, or unexpected financial expenses. Budgets can help you see where your money is going, and help you create a stable financial future. Several websites and tools exist to help create a budget that will be useful for your specific needs.
If you created a budget, then part of that should include a line item for saving a portion of your income every month. Creating a savings account is not only an exercise in discipline but also builds a safety nest in case you either need (or even want to splurge) on a particular item in the future. Building an emergency fund can help you for any unexpected expenses and help build the financial stability for any future unexpected events. Additionally, although you are just finished with bankruptcy it is never to early to consider saving for retirement. With a new fresh start after bankruptcy, begin preparing for your life not only now, but for years to come.
You will likely not qualify for a typical credit card with a lower interest rate. However, a secured credit card will help you rebuild your credit. Your credit limit for the card will equal the amount you put into the card. It allows you to rebuild credit by maintaining financial responsibility and paying your debts on time.
Check your credit score as often as you can. Most companies will allow you to check it every year for free. However, you can also track your credit score every month through some companies. This constant monitoring will ensure that you are moving in the right direction. If there are any abnormalities or any inaccuracies on your credit report, clean those up as soon as possible.
If you have a family member or friend that will allow you to co-sign a loan with him or her, this can help rebuild your credit as those payments are made. If that is not a possibility, then you can become an authorized user on your friend or family member’s credit card. Additionally, make sure that the credit card reports payments for all authorized users to the credit bureaus or it will not help your credit score build.
Never become discouraged about your financial situation. Rebuilding your credit and your financial life after bankruptcy can be challenging, but following small healthy financial steps will build your secure future. Filing for bankruptcy and the aftermath can be overwhelming and frightening. Contact an experienced bankruptcy attorney that can help you understand your rights and learn how best to build your financial future.
At Silverberg Law Firm LLC our team will analyze your case and determine that whether bankruptcy is the right option for you. If yes, then we will handle every aspect of your legal process, start to finish.
Which will help you make the right choice, and get out of debt smoothly, and fast.