What Happens After Filing Bankruptcy?
Many people are drowning in debt during the bad economy, and don’t know what to do to alleviate the situation. Having only one job is rarely enough these days, and more and more folks are asking what happens after bankruptcy? If you have been considering filing, you probably want to know what the future holds.
To answer the question of what happens after filing bankruptcy, these are some realistic expectations. First, if you’ll begin to receive many offers of low balance credit cards from unscrupulous creditors that claim they can help you rebuild your credit. Be sure to check membership fees and activation fees that will push your card near its credit limit before you even call to activate. Also be aware of over-the-limit-fees and late charges, which can land you right back in debt with late payments. If it seems too good to be true, it probably is.
Most conventional car loans, mortgages, and similar loans will not be available to you immediately after filing for bankruptcy. However, within 2 to 3 years these will again be within your reach if your payments are made on time. The bankruptcy will not help you get great credit right away, but it will allow you to slowly build your good credit standing. So what else happens after filing bankruptcy?
Your first few credit accounts and loans will most likely have a higher interest rate. These depend on your credit score, which will be low right after a bankruptcy. This does not clear your credit history although it does clear your debts. As these negative items get older on your credit report, they will have less and less impact. Replacing them with positive items that are more recent will help your credit score rise to better and better levels.
Most who file for bankruptcy find that not much in their credit life will change right after the discharge except they will no longer need to pay the eligible debts. It is important to take this opportunity to rebuild your credit once your old debts are eliminated. Talk to an attorney or law firm that specializes in bankruptcy filings, and your credit can become stronger than ever with lower interest rates and better terms. In the end, what happens after filing bankruptcy is a chance to make your credit history great!