Filing for bankruptcy can be an uncomfortable and overwhelming experience. While bankruptcy has the potential to let a person rebuild his or her credit score, bankruptcy can also cause a number of challenges including difficulty in securing credit. The following will review some strategies people can use to bounce back more quickly after filing for bankruptcy.
Create a Budget
If you are not familiar with living on a budget, it can be difficult to begin doing so. The first step in being able to successfully manage money, however, is to create a plan to do so. A budget should cover all of the necessities that you need to pay each month including mortgage or rental and insurance costs.
Use Cash to Pay for Things
Carrying around a small amount of cash can help make sure that you stay on budget and avoid buying more than you can afford. While using cash might be a good temporary way to avoid excessive spending, some people discover that this is a particularly effective way to reduce sending and make it a permanent habit.
Pay Bills on Time
Late payments suggest to lenders that you are not responsible in handling you money. In some cases, late payments can even be used as a reason why a borrower will be cautious about lending you money in the future. Some people discover that by setting up auto-pay, they are able to more easily avoid missing payments.
Create Successful Credit Accounts
After filing for bankruptcy, many people discover that it can be difficult to obtain credit, a credit card, or a loan. To greatly increase your chances of obtaining credit or a higher credit score, it is often a wise idea to add positive behavior to your credit history.
Secure a Credit Card
Secured credit cards are available to people with low credit scores and can be particularly helpful in restoring your credit rating. Credit cards are considered secure if your credit limit is based on the amount of cash that you deposit as collateral. If you fail to pay off your balance on a secured credit card, the provider of the credit card will collect on the money deposited. To select a good secured credit card, make sure that there are low associated fees, flexible terms for repayment, and that usage of the card is reported to the major credit bureaus.
Avoid Getting Scammed
Although there are some companies that can help you successfully rebuild your credit, a large number of companies that advertise this type of service are not able to actually do so. It is critical to perform research about bankruptcy services before using them.
Speak with a Knowledgeable Bankruptcy Lawyer
While bankruptcy can be full of obstacles, there are also some advantages to the process. An experienced bankruptcy attorney can help make sure that your case resolves in the best possible manner. Contact attorney Jim A Lyon today to schedule a free initial consultation.