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Top Steps to Recover from Bankruptcy

Master the Budgeting Process. To be successful going forward, you must learn the “Art of Budgeting.” This skill will help you from filing bankruptcy again. Please note, if you have to file again it is not the end of the world. However, you must educate yourself financially and actually implement what you have learned. While bad things happen to good people, the source of many people’s insolvency is simply living a lifestyle based upon poor financial principles and habits. Of course there are Lenders who take unfair advantage of the financially uninformed. That is why we must gain enough wisdom to escape financial “bondage.” Often these institutions are unscrupteous but this does not obsolve us of our responsibility too.

Decide between “Needs and Wants.” Do you need something or do you just want it.

Avoid immediately opening up new lines of credit. During the process and soon after discharge, you will probably start receiving offers for more credit cards and new lines of credit. Do not take the bait. It is well known that you are no longer able to declare bankruptcy again for another eight (8) years, so these companies know they have you for at least that long.

Accept an offer for a department store credit card if you must. Unfortunately, after bankruptcy knocks your credit down to next to nothing, the catch-22 becomes that you need credit to build credit. If credit cards were your weakness or perceived means of survival, get a department store credit card rather than a regular credit card. In this respect, your purchases will be limited to just what the store sells.

Purchase a new car, but only if you need one and if you can afford the payment. There is no better way to re-establish your credit than to demonstrate a post bankruptcy pattern of making monthly car payments on time. Creditors routinely make inquiries into consumer credit histories as shown on credit bureau reports, and will take note of your newly established credit history. A demonstrated history of making timely payments is an essential element of being offered loans with reduced interest rates and increasing your credit score. But remember, if you must purchase a vehicle, try getting a cheaper used car loan. A car loan is a quick way to rebuild your credit but only if you can afford it.

Make Major Purchases Without a Credit Card. It is a relief from the prison of debt that you have been under. As long as you have learned how to be a good steward of your finances, bankruptcy can be a real life saver for you, your marriage and your family.



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