Best Bankruptcy Recovery Path

March 24, 2022

Filing for bankruptcy is tough. You have to admit to yourself and others that you are not capable of paying back your debts and that you need help. Even though the majority of bankruptcies in the US aren’t a direct result of people’s actions, but rather of various external factors (like unexpected medical bills), people still find it difficult to accept that they need help.

However, once you’ve filed for bankruptcy and the whole process is done, what do you do? Your credit score is ruined, many of your assets are probably liquidated and you find yourself in less than enviable position. We talked to the bankruptcy specialists at The Law Offices of Mark L. Miller who told us what some of the most important steps in recovering from bankruptcy are.

Get a Job and Keep It

If you’d lost your job during (or before) the bankruptcy, it is vital that you find a job as soon as possible. This is important for numerous reasons. Bankruptcy is a reprieve from debt collectors, but you will continue accruing new debt if you don’t have a source of income.

Your landlord, too, will most likely ask for proof of employment before they will lease a home to you. The job you find doesn’t have to be perfect, it just needs to be good enough for you to get by. As you improve your credit score, you will get better options and better job offers, but you do have to start somewhere.

Keep Your Bank Account Active

In order to get your credit score back on track, there needs to be a paper trail of you having and spending money in a responsible manner. This means that you need to have a bank account and use it for most, if not all, of your payments.

This especially applies to big ticket items, such as paying your bills, rent, or even grocery shopping. As you continue to display proper fiscal responsibility, your bank will start offering you better conditions, and as a result, your credit score will improve gradually. In fact, most experts will recommend that you use your cards for every purchase.

Get a Special Credit Card

Chances are that your bank will not let you have a credit card right from the get-go. After all, credit card debt is usually unsecured, meaning it will get written off in case of a bankruptcy. This might limit you in the ways you can spend your money initially, but there is a workaround for that as well.

Some banks offer special credit cards for building credit score. They are geared towards people who are just recovering from a bankruptcy and need a credit card. The main difference between a regular card and this one is that the debt on this credit card is secured, meaning it won’t be eligible for deletion in case of a new bankruptcy.

Start Budgeting Properly

This brings us to the most important change you will need to make – a change in your habits and behavior. For a while, your finances will likely be less than healthy and you will need to learn to budget properly.

To that end, you need to make sure you prioritize your obligations – that is rent, bills, and any payments you need to make to your bank. Once those are accounted for, the rest of the money is yours to manage as best as you can.

If you have extra money at the end of the month, make sure to deposit it in a bank account – it will bring your credit score up faster. Getting over a bankruptcy is typically not easy, but plenty of people have done it, with just a bit of good advice and some determination, and so can you.

Categories:  

Leave a Reply

Your email address will not be published.

Related Posts

September 27, 2022
Five Must Have Kitchen Accessories

In this article, we outline five must-have kitchen accessories for any modern kitchen. If you are planning a brand new kitchen, or just upgrading an old kitchen, these five accessories are things you must consider including. They may seem a bit extravagant, and the technological components may not seem critical, but the benefits and convenience […]

Read More
September 27, 2022
How To Deal With Your Flood-Damaged Carpets

You might have invested in your dream carpet for your home, all fluffy, large, and brightly colored. With it being dear to you, there’s a high possibility you want it to remain as it is, without it getting dirty or torn. Now, you decide to leave town for a week or two for a vacation […]

Read More
September 27, 2022
Electrical Safety Training Courses for Workers. Which Classes Should They Attend?

A safe workplace creation is a multi-part process. One of the stages is providing an environment where everyone is aware of the electrical safety basics. This part should not be underestimated because improper use of electrical technology can lead to serious consequences. Today it is quite difficult to find at least one area, in which […]

Read More

LEGAL

Welcome to Urban Splatter, the blog about eccentric luxury real estate and celebrity houses for the inquisitive fans interested in lifestyle and design. Also find the latest architecture, construction, home improvement and travel posts.

SHOPPING

linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram