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  • After Bankruptcy: Tips on Financially Recovering

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    After bankruptcy, borrowers can start slowly recovering financially by focusing on paying down their remaining debts and boosting their credit ratings.

    While bankruptcy is a good option for many borrowers who find themselves overwhelmed by debt, it’s important that individuals who file for bankruptcy understand that they will still have some work to do after their bankruptcy case has been approved in order to get their finances back on track. In fact, with some diligent effort and consistent work, individuals who have filed for bankruptcy can begin to rebuild their credit and may be eligible to open up new lines of credit in as little as a year from their bankruptcy filing.

    Here are some tips on what borrowers can do to start financially recovering after filing for bankruptcy:

    • Pay down (or off) any debt not discharged by bankruptcy – While Chapter 7 bankruptcy will discharge many of a borrower’s debts, some debt – like student loans – will not be discharged by bankruptcy. For borrowers who still have debt remaining after bankruptcy, it’s important to focus on paying down this debt so that it doesn’t come back to haunt them with huge interest rates in the future.
    • Develop and stick to a budget – After bankruptcy, borrowers should have a clear understanding of what they earn versus what they spend on a monthly basis; using this information, they can create a budget that helps them live within their means and prevents them from accumulating additional debt that may necessitate a future bankruptcy filing.
    • Focus on raising your credit score – The best way to do this is to have one (or maybe two) credit cards that do not carry a balance on them month to month (or, in other words, that borrowers are paying off on a monthly basis). Although getting a new credit card after bankruptcy will likely involve high interest rates or having to front some collateral to secure the line of credit, borrowers who prove that they can pay off their credit card balances every month will soon be eligible for better offers on cheaper lines of credit.

    If you are struggling with debt and are looking for a financial fresh start, contact the trusted Colorado bankruptcy lawyers at The Law Office of Andrew McKenna. For more than 20 years, we have been successfully overseeing our Clients’ bankruptcy cases so they can resolve their financial issues as beneficially as possible. Our comprehensive legal knowledge coupled with our vast experience allows us to consistently and efficiently help our Clients achieve the best possible resolutions to their financial matters. For an evaluation of your case and expert advice regarding how to move forward, call us at (719) 201-4527.

    
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