Once your Chapter 7 Bankruptcy or Chapter 13 Bankruptcy has been finalized, and you’re ready to get on with your life, there are still some things you need to do after bankruptcy.
Here’s what we suggest.
1. Keep the paperwork
You’ll receive a copy of your full bankruptcy petition from your bankruptcy attorney, and a copy of your discharge order from the court.
You should keep these in case you need to refer to them in the future, such as when applying for new credit like a mortgage, or in case a former creditor tries to collect on an old debt.
If you have misplaced these, my office keeps them on file forever, but it is always best to have your own copy.
2. Check credit reports
You’ll need to make sure that you regularly check your credit reports, so that you are certain that your records are right.
You should allow around 3 months for records to be updated on your report, so there’s not necessarily any need to be concerned if there are issues at first.
Doing this will also ensure that your previous debts aren’t transferred to a debt collection agency.
Walker & Walker law Offices will actually help you pull your credit reports after bankruptcy and we will dispute anything about your bankruptcy that is incorrect.
3. Start budgeting
After completing your Credit Counselling course, you will more aware of your financial situation and be better prepared for the future.
By budgeting you will be able to see your income and expenses better, and understand what money you have left after paying your bills.
4. Have an emergency fund
By budgeting, and perhaps being more resourceful, you can put enough money away to create an emergency fund. This might be a separate bank account, or somewhere safe at home.
This will give you the peace of mind that in the event of an emergency or unexpected bill, you have the funds to cover some if not all of it. This will help to reduce the amount you may need to borrow.
By having an emergency fund, you will hopefully be able to avoid the circumstances that started your previous financial troubles.
According to Nerdwallet, as little as $250 is enough to start an emergency fund.
5. Consider credit
We say consider credit, as it can be used to rebuild your credit score.
Getting a low limit credit card, and using it to only pay for your groceries or gas, then paying it off at the end of the month is a great idea. It shows that you can budget, pay your bills on time, and that you’re not reaching your limit every month.
Perhaps you’ll also want to think about a new car or a mortgage in the coming years. Rebuilding your credit can give you more chance to get the car finance or new home you want.
My clients are able to get a new mortgage about 2 years after filing bankruptcy, and get offers for car loans almost immediately.
Conclusion
After bankruptcy, thinking ahead, saving, and regularly checking your credit score can help you to be positive about your future, and to put your previous debts behind you.
If you’ve successfully filed for Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, then you’ll know what a relief it is. If you haven’t yet, why not Contact Us today at 612.824.4357 for your Free Evaluation and see how we can help you become debt free?
