For many people, facing bankruptcy can seem overwhelming. Your finances are about to change in major ways, so it helps to be prepared and have a plan of action to get through the months and years following your bankruptcy.
Some Steps to Deal with Bankruptcy
- 1. Start fresh. If excessive debts brought on your bankruptcy, it’s a good idea to reevaluate and reform your spending behaviors. Learning to live more frugally can’t hurt, and it is usually a big help in the long run.
- 2. Consider a secured credit card. See about obtaining a secured credit card, make small purchases and pay off the balance on time each month. This requires a deposit that serves as a credit limit, but some companies will raise the limit without additional deposits for borrowers who make repayments on time.
- 3. Pay your bills. This should go without saying, but be sure that you budget your monthly expenses to ensure you can pay your rent/mortgage, utility bills, and other costs. Doing so can also help rebuild your credit after bankruptcy. Cutting down on some luxury services – like selecting a new cable or Internet plan – may help reduce monthly bills to ensure they’re paid each month.
- 4. Request copies of your credit report from all three credit bureaus. Make sure that all your debts are listed as “discharged under bankruptcy”.
- 5. Save! Make room in your budget to place some money in a savings account each time you are paid. Having extra funds in a savings account can help you better handle any unexpected expenses without relying on loans or credit cards.
It is possible to recover from bankruptcy and go on to a better financial future. Consult with a bankruptcy attorney for assistance throughout the bankruptcy process, and for answers to common questions or confusion that may pop up when filing for Chapter 7 or Chapter 13 bankruptcy.
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