You can't watch the news without realizing that millions of American's are struggling to pay their bills. Delinquencies and foreclosures are on the rise and many have no where to turn to for help.
For some, the only option is bankruptcy.
Bankruptcy leaves both financial and emotional scars that few can understand without having witnessed it themselves. Still, it isn't the end of the road but rather a new beginning.
If you've just been through a bankruptcy, here are some easy steps that will help you get your life back quicker than you thought possible.
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Please listen to this first step, because it is by far the most important: Do NOT let the bankruptcy define you!
Stop beating yourself up! It's OK to vow that you will never go through anything like that again, but let it go. Realize that that was a specific period of your life and not who you are. The past is no reflection of your future. It's time for you to move on.
Second, this may be a good time for you to consider multiple streams of income.
Even if you have a great job, one of the best ways to secure your families financial future is to derive your income from more than one source. Now that most of your bills have been eliminated, why not invest in yourself and learn internet marketing, or some other skill that could bring in a few hundred extra dollars a month? It beats blowing your money eating out and in the long run will make you feel much better about yourself!
Of course, you also need to re-start your financial life! The first thing you will want to do is reestablish your bank accounts. This may not happen overnight. A credit union, if you have one available to you, may be a good option. Go in and establish a relationship. Explain what happened to you and find out what it is going to take to get an account. Then do it!
Next, you will want to re-establish your credit. This step might seem counterintuitive. After all, wasn't it too much credit that got you into this mess in the first place?
Unfortunately, you have to use credit to get or improve your credit score. And having a low or no credit score is very expensive.
But you have terrible credit! Who is going to give you credit right after a bankruptcy? Fortunately, there are a couple of options.
The best option is to go to your bank or credit union and buy a certificate of deposit for a set amount, say $1,000. Then you will want to take out a secured loan against this CD. The bank is willing to give you the loan, because if you default they have the CD as collateral. They can't lose and you win by establishing a payment history on a bank loan!
The second way to re-establish credit is through secured credit cards. You will likely begin getting offers for these shortly after your bankruptcy has been discharged! A secured credit card works much the same way as the CD loan does. You will give the lender a set amount upfront and they will issue you a credit line of that amount or perhaps slightly more.
It is important that you choose your credit card company wisely. You don't want to pay an application fee and you are looking for a low annual fee. Additionally, you want a card that will convert to an unsecured credit card at some point in the future, typically after 18-24 months of on time payments.
Now that you've reestablished your credit, make sure you manage it wisely! Make all of your payments on time as lenders are likely to be less forgiving of minor slips ups than they would have been before the bankruptcy.
You will also want to keep a close eye on your credit report.
Make sure that lenders aren't reporting accounts that were included in your bankruptcy as open and past due. This happens more often than it should, especially when lenders have sold your account to collection agencies.
The best thing to do is to have a form letter on hand to send to anyone who contacts you. Make sure it includes your information, the case number and your attorney's contact information. That way, it is easy to respond and nothing falls through the cracks.
By following these steps, you can bounce back from bankruptcy in no time! In several years, you will even be able to own a home again!
Is Bankruptcy Right For You? Talk to Bankruptcy Attorneys Free and Confidential. Licensed bankruptcy attorneys are available. Attorneys will call you to discuss your case for free. Find out if bankruptcy is right for your situation.
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