Financial hardships can affect anyone from professionals with high incomes to individuals who earn minimum wage. Likewise, financial recovery is possible with determination and discipline. Although the process actually begins before you file, bankruptcy can provide people struggling with high debt and other financial setbacks a viable path toward a financial fresh start.
The first step is to make a commitment to yourself to change your current spending habits. By steering yourself away from the spending behaviors that contributed to your becoming seriously in debt, you can stay debt-free and rebuild your credit.
Equally important for a complete financial recovery is to carefully monitor your credit reports and scores. These reports determine your credit worthiness. A low credit score could prevent you from attaining certain consumer privileges, including:
- Lower loan rates at banks or other lenders
- Employment opportunities
- Certain options on insurance coverage
- Housing leases
Reporting errors can lower your credit rating. Recent studies found that some credit reporting agencies inaccurately list the status of people’s debts and payment history. The Federal Trade Commission (FTC) discovered serious errors on more than 10 million consumers’ credit reports.
According to federal law, you may request a free copy of your credit report annually. After filing for bankruptcy, you should review your credit report every six months and immediately dispute any errors in writing. The Fair Credit Reporting Act (FCRA) requires reporting agencies to remove any discrepancies on your report that the agency cannot verify.
Once the court discharges your bankruptcy debts, your credit report should not show any delinquent accounts related to your bankruptcy. These debts should accurately report a zero balance after your debt discharge.
Start your financial recovery by contacting one of our qualified bankruptcy attorneys today.