Now that bankruptcy papers are filed, a debtor can expend a sigh of relief. It’s a fresh start with a clean slate except for the big red flag on the credit report that states “Bankruptcy.” It’s time to roll up sleeves and get to work rebuilding credit. If strategized properly, it won’t take. Here are some tips to financial security:
Take back control.
Maintain a job and a residence. A stable job and place to live shows creditors that you are reliable and responsible.
Pay your bills.
It is imperative that a debtor stays current on all monthly bills and other payments so that the post credit report stays clean. Control spending by living within a budget that matches your income.
Keep a bank balance.
Opening and maintaining a checking and/or savings account is necessary and many banks offer some sort of second-chance program. This shows creditors that you have a reliable cash flow.
Start rebuilding credit.
Banks will almost immediately send a slew of offers after the discharge. Although interest will be high, debtors should obtain a secured credit card in which they deposit a given amount of money and that becomes the credit limit. Charging small amounts and repaying monthly can help rebuild credit. Debtors should keep a close eye on charges and pay them off in full each month. The payments will be recorded with the Credit Bureau, so staying on track builds trust in money management again.
Responsible spending begins with the right frame of mind. We educate debtors on money and credit. We help debtors stay accountable for their spending habits. We also have answers to frequently ask questions on life after bankruptcy on our website. Please share this information with any of your clients who are in a financial bind. We are here to help.