|June 16, 2017||0|
Bankruptcy is not a decision that should be taken lightly. There are some taxing financial implications involved and your financial freedom will be restricted for several years to come. This doesn’t imply that filing for bankruptcy is the end of the world though. It should really be considered as the first step in securing a bright financial future for you and your family. Millions of individuals file for bankruptcy every year and many of them are able to buy homes, cars and attain credit cards after they’re discharged. Further to this, understanding what life is like after you have filed for bankruptcy will certainly give you insight into making better financial decisions in the future.
Fundamentally, once you have declared bankruptcy, you give up control of your finances and assets to a Trustee for protection against litigation that may be taken by your creditors. Once the legal process has been completed, you’ll be undischarged for a specific period of time (in most cases 3 years) after which time you’ll become discharged, which signifies that the financial restraints you sustained during bankruptcy are lifted. Once discharged, your name will permanently appear on the public record (NPII) as a discharged bankrupt. What this article intends to achieve is to give you an understanding of what happens after you file for bankruptcy and what options you’ll have after you become discharged.
You Can’t Leave The Country Without Permission
One of the drawbacks of declaring bankruptcy is that you can’t exit the country while you’re undischarged only if you request permission from your Trustee. To do this, you’ll need to supply a lot of details regarding your destination, length of stay, contact numbers, and the reasons for your travel. It’s an offence to travel overseas without prior approval from your bankruptcy Trustee, and in most cases will increase the length of your undischarged bankruptcy to a minimum of five years instead of three.
You Will Be Offered Credit Immediately
One thing that surprises plenty of discharged bankrupts is that they will immediately be offered credit by a vast array of loan providers. The reason behind this is that you won’t have the capacity to file for bankruptcy again for an extensive period of time, so creditors understand that they have a good chance of getting their money back if you secure a loan. In some situations, obtaining a loan and making timely repayments will help improve your credit rating, which will help you in the recovery process. But be wary, you don’t want to accept every offer thrown in your direction as some creditors are very dubious and include hidden fees and charges that can put you in debt again straight away. The key is to rebuild your credit score progressively.
Buying A Home Is Definitely Possible
There’s a typical misconception that after you file for bankruptcy, you will no longer have the ability to secure credit for a home loan. This is certainly not the case. Whilst bankruptcy will leave you with a bad credit record, you can still purchase a home if you’re able to rebuild your credit within a few years, you pay all your bills in a timely manner, and you display a responsible use of credit. Needless to say, you won’t have the ability to obtain a mortgage straight after you’re discharged, so it’s imperative to build your credit rating sensibly before even thinking of securing a mortgage.
Check Your Credit On A Regular Basis
Most financial experts recommend that discharged bankrupts should check their credit report about twice a year. After initially filing for bankruptcy though, it’s necessary that you review your credit report every month for at least the first 6 months into your bankruptcy. Several creditors may still be requesting payments even though you are not required to make payments on any debts that were discharged in the bankruptcy process. So to minimise any further complications, it’s critical that you keep track of your credit report to make sure that it’s correct and up to date.
Although bankruptcy isn’t the most ideal position to be in, it doesn’t mean that your financial future is permanently restricted. There are some severe financial limitations imposed on people that declare bankruptcy, but after they become discharged and slowly rebuild their credit score, they’re perfectly capable of securing a bright financial future. Securing home loans and other credit lines will be possible a couple of years after discharge if the recovery process is well-planned and executed. Consequently, it’s critical that you seek professional advice from bankruptcy experts to assist you in the process, as bankruptcy is considerably complicated and there are many factors to need to be taken into account to ensure a smooth recovery process. If you’re contemplating filing for bankruptcy, get in touch with Fresh Start Solutions Gold Coast on 1300 818 575 or visit their website for more details: http://freshstartsolutions.com.au/bankruptcy-goldcoast