What Happens After Bankruptcy Discharge
If your debts have become overwhelming stresses in your life and you’re having difficulty with making payments regularly, filing for bankruptcy can be an essential way that you can shed the weight of your financial burdens and move on with your life. If you’ve been considering filing for Chapter 13 or Chapter 7 bankruptcy, it’s very important to consider how you could discharge most of your debts. It’s likely that you have many questions about what will happen after a bankruptcy discharge and how bankruptcy proceedings will affect your life. Here is a little more information about what happens after bankruptcy discharge and how you can get on with your life after bankruptcy:
After Your Debts Are Paid
A bankruptcy discharge will eliminate much of the liability associated with the qualifying debt in your life. You can discharge items such as your backed utility bills, personal loans, credit card debt, and medical debt. When you completed Chapter 7 discharge it’s likely that your case will conclude and you will be free of debt based on your agreement. Under Chapter 13 bankruptcy you will have to complete a repayment plan in which a court will issue you a discharge. The discharge will occur after all of your qualifying debts have been paid off under your payment agreement. Once you receive your discharge your creditor will be prohibited from collecting these debts from you in the future.
How Will Your Credit Be Affected After Bankruptcy?
Filing for bankruptcy will negatively affect your credit but it is definitely not something that will damage your finances for life. Many people are avoidant of filing for bankruptcy because they fear as though they won’t be able to qualify for credit products in the future.
Bankruptcy will give you the ability to remove late-payments and the struggle of your debt. It can also immediately remove a very high debt to income ratio which will allow your credit rating to rise over time. As you handle your finances over the first few months and years after your bankruptcy, you could see a significant improvement to your credit rather than a massive drop.
Managing Your Finances Wisely
Make sure that you continue to pay your bills on time and manage your finances wisely after bankruptcy so that you can see your credit score rise. A discharge could raise your credit score substantially as your debt to credit rating will affect nearly 30% of your overall score.
How You Can Access Credit and Financial Products In The Future
Acquiring new financial products and new lines of credit after a Chapter 13 or Chapter 7 bankruptcy can be quite challenging but there are definitely some tools that you can use to rebuild your credit. You may need to first apply for a secured credit card or choose a higher interest rate for credit products in the future. If you continue to establish a strong repayment history on your new credit products, your score can continue to rise. Make sure that your spending wisely and paying all of your bills on time so that you can reach a state of financial stability. It may take a few years of work with financial products, but if you can remain consistent and keep building up your credit score, eventually you could return to regular credit products and lower interest loans.
Are You Considering Filing For Bankruptcy?
Filing for bankruptcy does not have to be detrimental to your credit score. If you find that your debts are overwhelming it can actually be highly beneficial to choose the right of bankruptcy rather than letting your debts continue to mount. If you could use assistance in starting your personal bankruptcy case, keeping your home, and determining the best way to file for bankruptcy to maintain your credit rating, contact us today.
We are a team of highly qualified bankruptcy attorneys that can advise you through the bankruptcy process. Going through bankruptcy on your own can be a confusing process but by working with our team we can make sure that you can have control over your financial situation and predictive results for your future. Reach out to us today and we can complete a complimentary consultation for your bankruptcy options.
We can let you know more about the process of filing, how you can file more easily, and what you can expect after the process of filing. We want to leave you prepared and answer any of the questions that you may have about the process of bankruptcy filing.