Although a bankruptcy discharge makes it more difficult to secure a loan, it’s not out of the question.
There are many steps you can take to improve the likelihood of an approval.
Here’s what you need to do:
- Review your credit report. It’s important to know exactly where things stand in regard to your credit report, as this helps you make the right decisions in the near future. For example, if you come across an error, you need to report it immediately.
- Use a credit card. This is one of the best ways to rebuild your credit, thus making it easier to secure a loan in the future. You’ll probably need to use a secured credit card at first, so don’t shy away from this.
- Focus on a positive payment history. If you miss payments or make late payments after bankruptcy, it will show that you don’t yet have your financial life back in order. If you have a credit card, for example, you need to make timely payments.
Along with the above, don’t get ahead of yourself. Although you have your eyes on a loan, you shouldn’t rush. Doing so will complicate your finances, thus making it more difficult to make a full recovery.
There are many benefits of bankruptcy, including the ability to discharge debt and start fresh. On the downside, it makes it more difficult to secure a loan in the immediate future.
As long as you understand the bankruptcy process, including the impact it will have on your finances now and in the future, you’re in position to make a sound decision.