Filing for bankruptcy is a big step. It’s often a long and difficult process that’s a necessary part of getting your finances under control. After you’ve completed your filling, there are things that you need to do to make sure that you don’t head down the same path again. At James L. Gutting, Attorney-at-Law, we can offer expert advice from our bankruptcy lawyers in Flint as to things you should make sure you’re doing. Read our short guide below for some helpful tips.
Save all your paperwork
After you’ve completed the process of filing for bankruptcy, you’ll be given a detailed report of your financial information. This includes all the necessary information that you need about how your debts will be paid off, what was discharged, and what happened to your assets. Going forward, some new creditors are going to want to look at this report to learn more about your bankruptcy to make decisions about your qualification for taking on new debts. This is common with mortgages, auto loans, and other large debts.
It’s not uncommon for crippling debt to be the result of not having a budget. Often, individuals will continue to borrow money without planning for the upcoming monthly payments that will come as a result of new debts. You can better manage your money going forward by sticking to a strict budget. This will make it much easier to plan your finances so you can keep your debts and credit under control.
Review your budget often
While keeping a budget is important, it’s crucial that you continually review it. A budget is often fluid and can change every few months. Review the debts that are getting paid off as you go, expenditures that get added, and money you have coming in so you’re always aware of how much money you have and where it’s going. Reviewing your budget is part of effectively managing your money so you don’t get started down the path to bankruptcy once again.
Build an emergency fund
It’s normal to want to get a credit card with a high limit so you have money available in case your car breaks down or there’s another emergency that requires large sums of money available. However, having a credit card around with a large credit limit can be dangerous if you’re not careful. You might feel like it’s easy to nickel and dime the card here and there with things that you need at the moment. This can quickly add up and create a large debt once again. An emergency fund is far less tempting for you to touch in cases of small incidents or non-emergencies as you’ve worked hard to build that fund.
Check credit reports regularly
An important part of building your credit is knowing which way it’s headed. As you know, your credit took a hit after you filed for bankruptcy. Because of this, you’re going to want to make sure that the things you’re doing to help your score recover is sending it in the right direction. This will also make it easier for you to know when you’ve reached a point where you can once again buy a house or a car more comfortably as some lenders will require a minimum credit score to qualify for funding.
Take a new approach to credit
When you’re young, a credit card can feel like free money that you have no responsibility for. This is often how credit card companies portray their products in commercials as you’re getting rewards for spending their money. After you file for bankruptcy, this thinking needs to shift to an understanding of quality over quantity. Having good credit does not necessarily mean that you’ve taken out a bunch of loans and you’re slowly paying them off. Rather, good credit proves that you’re responsible with your money and maintain a strong debt-to-income ratio.
Book an appointment
If you’d like advice about what to do after filing bankruptcy, our team at James L. Gutting, Attorney-at-Law can help. Get in touch with our bankruptcy lawyers in Flint and we can help you get back on the right track with your finances so you can fully recover from your filing. Give our Flint office a call at 989-743-1188 or send a message using our online contact form. We look forward to hearing from you.