The decision is made, the paperwork filed, the bankruptcy completed. After what was surely one of life's roughest patches, you may be standing there thinking, "Now what?"
The events leading up to filing personal bankruptcy are often stressful and even traumatic. Now that it is over, you need to know how to move forward. Here are some do's and don'ts for building a good life after bankruptcy.
- DO Get and Stay Employed - A job is the first step toward stability. If you have a job, do your best to keep it. If you are unemployed, turn up the heat on looking for work. This will help you to....
- DO Pay Your Bills on Time - Building new credit history is a top priority at this time of your life. Create a list of your bills and add them to a calendar. Don't miss a payment! There are apps that can help you budget and manage your finances.
- DO Learn From Your Past - Perform a little analysis on yourself to figure out how you ended up in situation that required filing bankruptcy. Commit to doing your best to not ever let it happen again.
- DO Begin Rebuilding Credit Slowly - A few months after bankruptcy, apply for a small secured credit card. You will be required to put a deposit down, however, the positive credit history will be worth it. Charge a small amount every month and make a payment on time. These payments will be reported to the 3 bureaus, and will start adding positive information to your credit report.
There are many actions you should take, and even more actions you shouldn't take if you want to bounce back from a bankruptcy.
- DON'T Fall for Scams - Phone calls and emails offering to erase your bankruptcy from your credit report, rebuild your credit, or any other offer that sounds too good to be true IS too good to be true. If a company contacts you offering to quickly impact your credit score, avoid them as you would a week old tuna salad.
- DON'T Try to Re-Establish Credit Too Fast - While opening a secured card is a great idea, don't open more than one in the beginning. Applying for several lines of credit in a short time period will cause your credit history to be sluggish in rebounding. The reason for this is people fresh off a bankruptcy are judged more harshly on credit inquiries than consumers with good credit. Make sure to dip your toe into the credit pool. No swan diving!
- DON'T Put Off Saving - Even if it is only a few dollars a week, stash it away to give yourself a nest egg. Having some money saved will help you avoid charging during emergencies. Plus, it will make you feel secure.
Bouncing back from personal bankruptcy will not happen overnight. However, within several months circumstances WILL get better if you practice these DO's and DON'Ts, and you can be on your way to a bright life after bankruptcy.
If you think bankruptcy may be a good choice for your future, or just want some straight answers, contact our Torrance bankruptcy law firm.