What to Do After a Bankruptcy Discharge, According to a Debt Lawyer 


Filing for bankruptcy is not the equivalent of hitting rock bottom, even if it can feel like that sometimes. A more positive way of looking at this life changing decision, is that you now have a fresh start. With all of your old debt gone or restructured, you will have a new chance to build back your finances.  

Granted, doing that can be a lot harder when bankruptcy can stay on your credit report for nearly a decade. But there are ways that you can financially recover from it. Here are a few solid ways that you can better rebuild your finances after your bankruptcy case.  

Steps to Recovering from a Bankruptcy Discharge  

Starting off fresh isn’t just a daunting prospect; it can also be an exciting one. But even when you have the help of an experienced debt lawyer on your side, you will need to look at how you can rebuild your financial profile. Here is a closer look at a few steps that you can take to recover from a bankruptcy discharge.  

Keep All of Your Paperwork from the Bankruptcy  

One of the first steps to ensuring that you can better move on from your bankruptcy is to save all of your files from the case. Along with being a good practice to keep records, this can also be useful when you apply for a loan or mortgage.  

But even if you won’t be applying for any type of loan anytime soon, keeping this paperwork also helps you better deal with debt collectors. If they try to bring up debts that you have previously paid off, you will have proof of that, and you can move on.  

Check Your Credit Report 

The next step to building back your finances is to take a detailed look at your credit report. Your credit report will include information of what makes up your credit score. This can be a great way to make targeted improvements to your credit score, ensuring that you see your credit score rise.  

On the other hand, if your credit score isn’t rising as you think it should, you can easily check your credit report to see why. If you notice any errors that are affecting your score, you can have them fixed accordingly.  

Build a Budget  

Even if you think that you have all of your finances figured out, building a budget can be a quick and easy way to chart out your spending. More importantly, it can also help you think about any hidden expenses or debts that slipped your mind initially. Granted it can feel a little restrictive, it can also be a good look into your spending habits, which you might have to correct if you want a better financial future.  

To build a good budget, you should first chart your spending habits from the previous month and then figure out your financial priorities. After setting up your expenses, you can then see how much you need to earn to mitigate those expenses.  

Start Saving Money  

It’s always a good idea to look at “saving money” as an expense since it puts pressure on you to set money aside. More importantly, by putting it as an expense, you’re less likely to burn through your money and then have nothing left to save.  

You could always follow the 50/30/20 method. 50% for your needs, which include essential expenses. 30% for your wants, like subscriptions to Netflix or hanging out with friends. Finally, 20% off your savings. 

Build Good Credit 

This step is essential to rebuilding your future finances, since a bankruptcy can be a major hit to your credit score. So to make sure that you can recover from the hit you’ve taken, you need to make sure that you’re exercising good credit habits.  

Start by paying your bills on time and reporting them toward your credit history. Along with helping you build better credit, it can also be a good way to show creditors that you are a more responsible individual.  

You can also try to open a secured credit card, which you will essentially be using to build credit. You won’t be making any purchases from it, and will simply pay off it’s fees regularly. You will have to make sure that you have paid off your remaining debt from the bankruptcy first. Consider speaking to your debt attorney about the possibility of such a credit card.  

Get the Help of a Co-Signer 

Building good credit means that you first have to take on credit and pay it back, which can be difficult to do so when you can’t qualify for it. If you’re having a hard time qualifying for a credit-builder loan or a secured credit card, you can ask a co-signer for help. A co-signer is any person who agrees to pay for your loan if you fail to do so as the primary borrower.  

The co-signer won’t have any rights to the object of a loan, such as the property, but they will be taking on the responsibility of repayment. Furthermore, if you fail to make payments on time, it could also damage their credit score. So, you need to be careful who you ask to become your co-sign.  

Try To Maintain Your Home And Job 

Maintaining your home and job is essential to rebuilding your life after bankruptcy. By keeping a steady stream of income, you can show lenders that you are responsible and that you can pay back important loans on time. Lenders are also likely to review your employment history when they review your application, so keep that in mind before you switch to a new job. Even if you are regularly switching jobs because they are better offers, lenders might not see this in a favorable light. This is another thing that you should discuss with your debt attorney before following through on it.  

Rebuild Your Finances After a Chapter 7 Bankruptcy Piece By Piece  

Filing for bankruptcy is never an easy decision, but this is not the end of the road. You don’t have to worry about how this affects your credit score since you need to focus on ways that you can rebuild it. By following these steps and the advice of an experienced bankruptcy attorney, you can be on your way to building your financial profile again.  

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