In the wake of the new law, many people have ruled out filing for bankruptcy and are opting to try and pay their debts down themselves instead. This may or may not be a good idea, because it can be very hard to dig yourself out of financial trouble on your own. And despite your best efforts, your credit score probably will just keep heading further and further down south.
To help repair your finances, you might want to consider filing for bankruptcy. But, don’t let the new law scare you out of filing if you believe it would be the best option for you. It’s true that it will now be a little harder to file and that there are more paper work and hoops to jump through than ever before, but bankruptcy can still be that fresh new start you’ve been dreaming of.
Many people that file bankruptcy find that it takes only three to four years after discharge for their credit score to be repaired. If fact, their credit scores are reaching ideal levels, which enables them to get loans for the things they want in life, a dream home, car or vacation. After their bankruptcy discharge, the people that used their money to make down payments on large items, rather than trying to pay off old debt, are the ones that were able to repair their credit the fastest.
If you decide to forgo the bankruptcy option and try to get a handle on your finances yourself, be careful. You might be facing years and years of financial trouble because most lenders will be cautious of people that have a pile of debt and a low credit score. To help yourself climb out of the money pit you created, use your credit card to make small purchases and always pay them off swiftly. If you don’t have a credit card anymore, apply for a secured card with a low limit and make sure it reports to all three of the credit bureaus.
Before you make your decision on whether or not to file, consider the repercussions. Figure out just how large your debt is and how long it would take you to pay it off. Then, read up on the new bankruptcy law and talk with a lawyer before coming to any conclusions. Educating yourself on both options will help you make the decision that will work best for your long-term financial situation.
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