Filed For Bankruptcy? There Is Still Hope!

Because of the unfortunate economy, many people are finding themselves in financial difficulties that lead to bankruptcy. You could be one of these people, and the road ahead may seem dark and dreary with no end in site; yet, this does not have to be the case. The truth is recovery from bankruptcy is not simple and it is definitely not easy, however it is possible. Consider the following advice that may help you as you take the steps to set up a better financial future for yourself and recover from bankruptcy.

When you do file for bankruptcy, it is extremely important to speak with your creditors about you situation so they know what is happening. There are certain assets that are non-exempt from the bankruptcy process, including cash and certificates of deposit, and you will be required to return these assets to your court-appointed trustee. This is typically the first part of the many steps required for bankruptcy, though, the next steps should focus on recovery so that you can create the best financial future possible for yourself, despite the circumstances.

During the next few years, it will probably be difficult for you to get credit from lenders because they are usually hesitant to work with people who have filed for bankruptcy. Typically, when you file for bankruptcy, you will not be able to qualify for a home or car loan right away either. However, there are some creditors out there who might be willing to offer you credit at a high interest rate.

Sometimes the biggest mistake those suffering from bankruptcy make comes from their negative attitude. A positive attitude can make all the difference in your credit and financial future even though you may not think so. There is truth to the “power of positive thinking” when it comes to bankruptcy, especially when so much about bankruptcy seems negative. Therefore, do your best to remain positive amidst the negative and you will find that you will have a renewed ability to meet the challenges that lie ahead.

Many people who file for bankruptcy still keep their cars, because they need a vehicle to drive around. If you are making payments on the vehicle, make sure that you talk to your car lender and sign a reaffirmation agreement. This agreement specifies your willingness to act in good faith and continue making payments and it allows you to keep your vehicle despite the bankruptcy. Also, continue making payments in full on time to help your credit and to avoid your vehicle being repossessed.

One of the most important parts of recovery after bankruptcy will be establishing new lines of credit, which will be difficult given the bankruptcy on your record. Most likely traditional banks will not approve you, however there is a chance that they will allow you to deposit money into an account and give you a credit card attached to that card, also known as a secured credit card. This may not seem like the best option given that you recently filed for bankruptcy and money is tight, however, it is necessary to establish some sort of credit.

Besides seeking access to new credit, you will also want to make sure that your credit reports are clean. Check with the credit bureaus – Equifax, Experian, and Trans Union – to make sure that your debts have been eliminated due to bankruptcy and that your report specifies this. If your report does not show this, you might want to talk with someone.

While you are seeking to re-establish your credit, it is important to resist co-signing for anyone. Although co-signing may seem harmless, if the loan goes bad, it will be on your record for awhile and their will be a judgment against you, especially because of the bankruptcy on your record. When it comes down to it, the risk is simply not worth it, even if you think it will help you build your credit.

Many people seem to think that carry a credit card balance is good for your credit, however if you can pay off the balance you should. Paying off your balance in full is great for your credit and it is also smart on your pocket book. Remember, you cannot foresee the future, and credit card balances could be a problem if unexpected financial crises arrived.

When you do file for bankruptcy, be aware that people will ask you about it, even though you might feel as if it is an invasion of privacy. Many crazy people file for bankruptcy, and chances are you are normal, just going through a difficult time; so, you should be willing to explain this to people, especially creditors so they do not wonder. Get your story straight so you know what to tell people regarding your situation.

Remember, life happens, and if for you bankruptcy is a part of that, oh well. Be positive and move forward. Recovery is a process, but it is possible.

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