Life After Bankruptcy

Life after bankruptcy is like a road with a fork in it--one can choose to take the path that leads to better financial decisions and a more prosperous future, or take the path of repetition and be no better off than before. The point is, for most people who have filed for help under Chapter 7 or 13, it will be necessary to handle finances differently than in their pre-bankruptcy days, according to those who give financial advice after bankruptcy. When debts piled up out of "wants" instead of "needs" a change in attitude is absolutely necessary. However, when the process has resulted from personal tragedy, i.e., job loss, illness, or accident that has drained a person's financial reserves, the situation is quite different.

Financial advice after bankruptcy is available from more than one source. The attorney who helped to file the case in the first place would be the logical first choice for guidance. Where an individual filed on his own (not usually the best way, but for some it can be done), then finding an attorney who handles these cases would be a good beginning. In addition, there are a number of consulting companies who will help a person with financial problems without charge. Conservatism in financial matters is the logical first approach to regaining financial stability in life after bankruptcy. Separating what is needed from the wants in one's life can put things in perspective. Simplifying life helps not only on the financial level, but on the spiritual as well by relieving the stresses that come with money problems. Jesus helped his disciples not to rely on money for their security: "And commanded them that they should take nothing for their journey, save a staff only; no scrip, no bread, no money in their purse;" (Mark 6:8)

One unalterable fact that results from bankruptcy is that the proceeding stays on the debtor's credit report for ten years. Anyone the debtor approaches for credit will see that when they do a credit check, and many times it is enough to result in a turn down. There are ways to overcome that handicap. One thing that can be done is to get a prepaid credit card from the bank. Put in a given amount of money into a special account, have the bank issue a credit card up to that limit, and use it for purchases. This will help to re-establish a good credit record. Life after bankruptcy might also include getting a mortgage loan for extra cash for purchases. As long as the borrower is gainfully employed, this could give a person the "leg up" needed to begin the climb back to credibility where money is concerned.

Life after bankruptcy isn't altogether bleak. There are lenders that will look further than the legal proceeding to make their decisions on lending to someone who has taken that route. Car dealers especially, are often willing to work with post-bankruptcy customers because transportation is necessary for them to work. The drawback is, the interest will likely be a little higher than for the person who has a better credit record. Also, for things like clothing there are second-hand shops that carry some quality clothing for a fraction of what would be paid in the retail stores. Financial advice after bankruptcy will largely be a matter of taking a different view of the world. The kind of car one has been used to, and the clothes a person wears may have to be adjusted. Eating out may become a rarity, along with other sorts of entertainment.

If a person filed for relief because of job loss, financial advice after bankruptcy may come in the form of suggestions for classes that will prepare a person for a different line of work. These can be arranged without cost to the student under certain government and private organizations that work with various campuses, or student loans may be obtained that won't have to be paid back until the student is gainfully employed at whatever he has prepared himself for. Also included in advice after bankruptcy may be greater cooperation in the family. Where children are old enough to hold down part-time jobs, they can bring in needed cash. If a spouse has not been working, perhaps that will have to change. All of this will be temporary until the breadwinner is once again gainfully employed. Life after bankruptcy sometimes means difficult choices.

Americans have become so accustomed to living above their means through the use of credit that it's easy to understand how people wind up having to seek help through the court system. When debt reaches the level where no matter how hard the debtor works he cannot keep up with the burden, there is little alternative. Financial advice after bankruptcy can be an enlightened time if the debtor is successful in changing his attitude toward spending and saves more. This change in attitude, along with learning how to budget what is coming in constitutes the most important points stressed when someone offers advice. Finding a source for this kind of advice is not complicated. Attorneys are listed in most phone books, and of course there is the Internet search that is available to those having computers. No one has to face post-bankruptcy problems alone.

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