Filing for a chapter 7 bankruptcy can give you a fresh start. However, many people find that life after chapter 7 bankruptcy isn’t what they thought it would be. After a chapter 7 discharge, many people may have issues trying to figure out how to manage their money or struggle to buy a house or a car.
If you have found yourself in this situation, there’s a lot to know about recovering from chapter 7 bankruptcy. Here are 3 things to keep in mind for life after a chapter 7 discharge.
You Need To Create A Thorough Budget
Many people find that they have to file for bankruptcy because of their spending habits. Even if you had to file for bankruptcy due to things like medical debt, divorce, or unemployment, you can still benefit from creating a thorough budget after a Chapter 7 discharge. Don’t go on a spending spree just because many of your debts were wiped out.
Take a thorough look at your bills and income so that you can figure out how much money you have leftover every single month. It’s also a good idea to put as much money as possible into a savings account. This will allow you to have the necessary funds needed when unexpected expenses occur.
Building Up Your Credit Score May Take Some Time
When it comes to adjusting to life after a chapter 7 bankruptcy, one thing to focus on is building your credit. A lot of people become very discouraged when they see that their credit scores tanked after filing for a chapter 7 bankruptcy.
Fortunately, you can bring your scores up if you use credit responsibly. You may need to start by getting a secured credit card, only making a small purchase on it every single month, and paying it off by the due date. By having responsible spending and credit habits, you may wind up having a score that is a lot higher than it was before you filed for chapter 7 bankruptcy.
You Can Still Buy A Car Or A House With Some Patience
Now that you are trying to live your life after chapter 7 discharge, you may want to buy a new car or a house. Many people are actually able to finance these types of items within a couple of years of filing for bankruptcy.
While your bankruptcy will stay on your credit for 10 years, it will have less of an impact over time. What this means is that you can greatly improve your chances of getting a good interest rate by waiting to make these types of purchases for as long as possible. Stay patient, and you can buy a car or home.
Make Sure to Talk to an Experienced Attorney
Navigating life after a bankruptcy may not be easy, but it is possible to recover. Our Michigan bankruptcy attorneys not only help you through the bankruptcy process, but we can also help prepare you for what life after a chapter 7 bankruptcy will look like.
