Chapter 7 Success Lawyers Chicago - Credit After Chapter 7 Bankruptcy

Credit After Chapter 7 Bankruptcy

One of the most common questions that I get asked from a potential client is "can I get credit after a bankruptcy?" Amazingly, clients are interested in credit when they are completed drowning in debt. Maybe is it because they have grown so accustomed to relying on credit to survive rather than relying on good budgeting techniques? In any event, clients are relieved to hear that there will be future opportunities for credit after a Chapter 7 bankruptcy filing.

The credit that one can expect is to pay a higher interest rate on secured purchases. Unsecured purchases will take some time to develop. The great news is that one can purchase a vehicle shortly after filing bankruptcy. Although the interest rate will be higher than normal, it is a way to re-establish credit and show the world that you can begin to make timely payments. This strict structure of making monthly payments will open the doors to other credit options.

As far as real estate, I recommend that you wait two years from the date of filing to attempt to qualify for a mortgage. By that time, the lenders are more willing to accept applications, provided that there is no negative credit activity since the filing of the bankruptcy. Additionally, this additional two years will give you the time needed to save for a decent down payment. Importantly, do not attempt to purchase property that is beyond your means. Start off small and affordable. You don't want to fall victim to the same issues that caused you to file Chapter 7 bankruptcy in the first place.

After time passes, the further you will move away from your bad credit days. The thought of the bankruptcy will be long passed and you will have moved on with your financial life. I have seen it done successfully, over and over again, since 1991.

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