Post-Bankruptcy Loans: What You Need to Know after Filing

Many of us are aware that bankruptcy is a last-resort strategy if you are in financial trouble. Besides the immense headache that the court process can cause, filing for bankruptcy leaves a stain on your credit that will never go away. While there is a real benefit from having all your past debt erased from your credit history and starting new, the effects and pains of bankruptcy will never really go away.In an effort to restart your life post-bankruptcy, however, there are options. Due to your clean record in terms of debt, once you are able to find a job and a steady means of income there are lenders who will be more than happy to serve you. There are plenty of opportunities to receive post-bankruptcy loans in today’s financial market as long as you know where to look.Your New Appeal to LendersThe idea of a lender actually wanting to serve someone post-bankruptcy may at first seem absurd. However, there are a few key factors to your life now that, from the lender’s perspective, actually make you a desirable client. Therefore, many lenders will actually specialize in granting post-bankruptcy loans.Consider the following facts of your situation after filing for bankruptcy:• You have limited or no other debts. With the exception of a few key areas (taxes, school loans, and child/spousal support) the process of bankruptcy discharges all the loans you currently have leaving you with a clean slate. Lenders are eager to loan to people with little to no other financial obligations since it ensures that they can afford the monthly payment on their new loan.• You have a job. As I mentioned earlier, most post-bankruptcy loans will only be possible once you find a job. If you have consistent employment for five years or more, you are in a really good position since that shows your ability to stay in a position and draw a reliable paycheck. Since you have a job, should you fail to repay your post-bankruptcy loan, the lender knows that he has the option to garnish your wages.• You cannot file for bankruptcy again. Once you complete the process of filing for bankruptcy, you are not allowed to do so again for a long period of time. This discourages bankruptcy law from enabling bad spending habits. Lenders offering you a post-bankruptcy loan will know how long you have until you are eligible for another bankruptcy filing and will therefore only offer you a loan with a term inside of that timeframe. This actually makes you an ideal candidate to lend to since you do not have the option of filing for bankruptcy and walking away from the lending table, leaving the lender with nothing.Loan Qualifications after BankruptcyThough your life after bankruptcy does not mean that no loans are available, the ones that are offered will be sparse. Generally, you can expect a lender to offer no more than a $5,000 unsecured loan. However, taking this loan and repaying it according to terms is a really important first step in getting your financial life back on track after bankruptcy.Another option you should look into is the use of secured credit cards as a means to build a new credit history. These options are often offered by the same lenders who specialize in post-bankruptcy loans and are a safe way to begin to rebuild credit.Finally, make sure that your life after going bankrupt includes a healthy assessment of the attitudes and habits that led to these problems. By making positive changes today, you set yourself up for a brighter financial future in the years to come.