Tips For Recovering From Bankruptcy
With the recent financial crisis in America bankruptcy lawyers have seen individuals and businesses alike suffer major hardship. In early 2000 people were taking on significant debt because they were confident that their assets would hold value and student loans would be easy to repay after graduating and obtaining a job. Unfortunately the bubble burst and it became very challenging for people to pay back their debts. Many lost jobs and struggled to find a new one. Some were forced into lower paying jobs while others simply remained unemployed.
Anyone who has been affected by financial crisis knows how daunting it can be to try and recover. Bankruptcy can cause fears of how to get life back on track. If you are trying to get your life back together after bankruptcy you are not alone. Here are several tips to help you get your life back after bankruptcy.
Find your weakness
There is a reason that you filed for bankruptcy. For some it is easy to pinpoint such as job loss but others may need to examine spending habits to determine the cause of the financial crisis. Once you know how you landed in bankruptcy, it’s time to move forward and make sure you change those habits for good.
Watch your credit score
Keeping an eye on your credit score is important while you recover from bankruptcy. Make sure all the information listed is current and correct. It is possible that there is old or incorrect information listed that is negatively effecting your loan options and even your job applications.
Set milestones
Give yourself some key goals to work towards. Paying off specific debts, cutting back on spending and increasing your credit score are all examples of goals to set for yourself as you recover from bankruptcy. Focus on one at a time to stay motivated.
Make bill payments on time
Did you know that your bill paying habits make up roughly 35% of your credit score? This means that simply making sure every bill is paid on time can greatly improve your credit score.
Build credit
Research ways to improve your credit score besides paying bills on time. One solution would be to take out two credit cards. Spend a reasonable amount with each card and then pay both cards off in full each month. This is a strategy to improve credit.
Get professional help
It is not hard to find a financial counselor these days. In fact, there are many organizations that offer this service at no charge. Find someone that offers credit counseling and set up a meeting. They can help you navigate the process of repairing your finances.
The glass is half full
There is no reason to let bankruptcy get you down. Staying positive is important to getting back on your feet. Once bankruptcy is complete and debts have been paid off most people see a benefit to their credit score right away. You’ve been given a fresh start! It is true that lenders will see you as a risk for a short time but it won’t be long before they give the opportunity to take out a loan.
Beware of dishonest lenders
If you’ve filed bankruptcy there will be some lenders that will target you specifically. They will offer deals that seem too good to be true that often have sky high interest rates. These offers are risky and can jeopardize the financial profile you are working to build. Don’t take easy deals. Instead do the work necessary to improve credit and get back on your feet. You’ll be grateful you did.
This guest blog post was provided by Chang & Carlin, LLP. The Chicago bankruptcy lawyers of Chang & Carlin can help you navigate through bankruptcy and ensure the process goes as smoothly as possible. Chang & Carlin offer one on one legal advice as well as aggressive representation and reasonable fees.
Image Courtesy of madaboutasia
