Life After Bankruptcy

Regardless of the type of bankruptcy that you have filed, you will have to deal with the consequences long after the case is over. However, you should not think of your life after bankruptcy as financially hopeless. In fact, it can be a wonderful opportunity to rebuild your credit and make it even stronger than it was initially, providing that you go about it in the right way. There are benefits and drawbacks to any type of bankruptcy, and you must learn to work with these in order to help yourself and improve your financial situation. If you do so correctly, you will find that the changes you experience in your life are positive rather than negative.

If you have filed for Chapter 7 bankruptcy, you should be aware that this will appear on and effect your credit report for ten years. This can make it difficult for you to secure credit of any kind. This includes opening bank accounts, securing housing, and getting loans. It is in your best interest to try and do these things prior to filing for bankruptcy, but if this is not a possibility, you will simply have to start small and work your way back up. Keep in mind that having a bankruptcy on your record will not look nearly as bad as having several long lasting and ever-mounting debts, so you may actually be doing yourself a favor. Try to get housing, loans, or future credit cards with smaller companies or with companies that specialize in working with those with poor credit. When you do secure the things you need, be sure that you are timely with your payments and that you do not take on more than you can handle. Not doing this is likely to put you back in the same situation that caused you to file for bankruptcy in the first place. You must make lifestyle and general spending changes in order for bankruptcy to have any real impact on your life.

With Chapter 13 Bankruptcy, the process is a bit different. You will have made a plan to pay off your debts in a timely fashion, using your disposable income, and you will be required to do as you have promised. Though the bankruptcy will remain on your credit for seven years, each time you satisfy a requirement of the plan or pay off a bill, your credit score will go up. In this way, Chapter 13 bankruptcy can actually be a way to improve your credit score, depending on what bills were affecting it before. As with Chapter 7 bankruptcy, you may have some credit difficulties, but for the most part you should notice positive changes. In short, your life is not over just because you have filed for bankruptcy. It is still possible to make good choices and to get back on your feet.

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