Actively managing finances after bankruptcy can lead to a stronger credit score.
November 05, 2013 /24-7PressRelease/ -- Managing finances after bankruptcy
Article provided by The Ford Law Firm, PLLC
Visit us at http://www.forddebtlaw.com
Over 1.1 million individuals filed for bankruptcy in the year spanning between March of 2012 and March of 2013, according to statistics provided by the United States Courts. Bankruptcy provides a fresh financial start, but individuals who take a proactive approach to financial management after bankruptcy may have more success restoring their credit in less time than those who do not.
Whether receiving relief through a Chapter 7 or Chapter 13 bankruptcy petition, it is important to start rebuilding credit after the petition is granted. Some top tips for effectively managing your finances after bankruptcy can include the following:
-Buy on credit. It may seem counterintuitive, but in most cases it takes debt to rebuild a credit score. Proper management of debt actually helps add points to a credit score. As a result, it can be helpful to get a credit card and use it to purchase some goods. Just be sure to pay the bill on time every month. A credit score is positively impacted by paying the credit card off on time every month.
-Be timely. It is important to pay off all bills on time, not just credit card bills. This means rent, utilities, cellphone bills and any other debts must be paid on time.
-Budget. A properly structured budget can help ensure the funds are available that are needed to pay off bills. Financial experts now recommend setting aside an emergency fund to cover six months worth of bills. Include basic expenses like rent, car payments, utilities and groceries.
-Be vigilant. After a few months have passed, request a copy of your credit report. Review the report to make sure debts that were discharged in bankruptcy are reflected in the report. Make sure all accounts that should be closed, were. Amend any discrepancy as soon as possible.
In addition to actively managing finances, it is also important to be wary of any credit-repair scams. If an offer seems too good to be true, it likely is. Any company that offers to repair a credit score for a fee is likely running a fraudulent scam.
If you are struggling with debt, it is important to know that there is life after bankruptcy. Contact an experienced bankruptcy attorney to discuss your situation and review your options. This legal professional can review various forms of debt consolidation, management and modification options as well as relief through bankruptcy.
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