Denver Bankruptcy Attorney Wink & Wink Can Help You Get Your Financial Life Back on Track
Declaring bankruptcy can be a life-changing event. However, it doesn’t mean your financial life is ruined forever.
It doesn’t mean you’ll never be able to buy a house again or obtain a credit card.
It also doesn’t mean you’ll be forever penniless and have a large “B” on your shirt (or your credit report) the rest of your life.
In fact, if you’re in need of debt relief, filing for bankruptcy can be the smart choice to get your life back on track. While you don’t want to rush into bankruptcy, letting your debt problem go on for too long is likely going to only make things worse. Bankruptcy can be the fresh start you need.
With the help of a skilled debt settlement attorney, such as Wink & Wink of Denver, Colorado, you can begin again and start rebuilding your credit and improving your financial situation.
Here are the steps that happen after bankruptcy and how you can rebuild your financial life.
Inform Creditors and Liquidate Nonexempt Assets
Once you’ve filed for bankruptcy with the help of your bankruptcy attorney, the Bankruptcy Court will appoint a bankruptcy trustee to handle your case. This trustee will meet with you, your lawyer, and creditors to notify the creditors that you’ve filed for bankruptcy. This will momentarily stop them from collecting on debts that you owe them or continuing to harass you for payments.
At this time, you’ll be required to liquidate any nonexempt assets to go toward paying off debts. Examples of nonexempt assets include cash in a bank account above $2,500, investments other than what’s in retirement accounts or health savings accounts, and antiques.
In a Chapter 7 bankruptcy, once you’ve liquidated all your nonexempt assets, your remaining debts will be discharged. In a Chapter 13 bankruptcy, you’ll be asked to repay any remaining debts through a three- to five-year repayment plan.
Thankfully, you will get to keep many of your assets up to a certain value, such as a car, home, household items, clothes, retirement accounts, and more. These are considered exempt assets.
Maintain Steady Employment
After you’ve filed for bankruptcy, it’s necessary to be on your best financial behavior if you want to avoid future debt problems.
Get a job if you don’t already have one and keep it.
This job isn’t just to make money (though that’s very important too!). A steady job also shows creditors you’re reliable, that you’re not constantly jumping from job to job or going through long periods of unemployment.
Creditors need to see you can maintain steady employment and thus have a better chance of being able to pay your bills.
Live in a Steady Home
Similarly, it looks good to creditors when you have a home (apartment, house, etc.) and stay there for a while. If you’re constantly moving, it can make you look unreliable.
Making regular rent payments – in full and on time – helps build up your credit again after a bankruptcy.
Be sure you live in an affordable home. If necessary, stay with a friend or family member until your financial situation is on steadier ground.
Pay All Bills in Full
No more debt. Pay every bill in full, and make sure every payment is completed on time. Don’t let yourself fall behind. If you can’t pay off the bill now, then you can’t afford it. You need to do your absolute best to build your credit back up and show lenders – people who lend you money or credit – that you’re a reliable customer.
Get a Secured Credit Card
Many people are used to unsecured credit cards – where you first borrow the money on credit that you’re then expected to pay off later. A secured credit card, on the other hand, is one where you first deposit the money into the account and then you can use that credit card to make purchases.
For people who have filed for bankruptcy, lenders may be leery to issue you unsecured credit cards due to your problems with debt.
However, some may be willing to issue you a secured credit card. Use this responsibly, pay it off in full each month, and never max it out, and you’ll then build up your credit score again and possibly be able to get an unsecured credit card in the future.
Expect 7-10 Years Before the Bankruptcy Disappears From Your Credit Score
When someone runs your credit report, they’ll see, for a period of time, that you filed for bankruptcy. Bankruptcy will appear on your credit report for about 10 years.
During the first few months after filing bankruptcy, it will likely be harder to get credit or loans toward cars, houses, or other big purchases, without paying exorbitant interest rates or other fees.
But if you use this period to pay off all bills in full and on time and practice other smart financial behaviors, such as the others described in this article, you should be in much better shape within 1-2 years of filing bankruptcy.
Consult a Denver Bankruptcy Lawyer Today
The first step toward obtaining debt relief is speaking to the passionate and skilled Denver bankruptcy lawyers at Wink & Wink. They’ll review your case, determine if bankruptcy is right for you (and which chapter), and help you get back on track toward a better financial future. Call 303-410-1720 or contact us online now.