Life After Bankruptcy
Life After Bankruptcy in Manitoba: What happens once I receive my bankruptcy discharge?
When you complete all of your bankruptcy duties you will receive your discharge from bankruptcy. In almost all cases, this will occur automatically and you will receive your official certification of completion.
A record of your bankruptcy will remain on your credit report for several years, depending on the province or territory.
A second bankruptcy will remain on the credit report for longer than a first bankruptcy filing.
While your bankruptcy will eventually be removed from your credit record, the bankruptcy will always be a part of your past.
Borrowing Money After Bankruptcy – Getting Credit Again
Bankruptcy impacts your life seriously, but it is intended to give you a fresh start to your financial life.
The ability to get credit and rebuild a secure financial future is part of the fresh start that bankruptcy gives a person.
A first time bankrupt will have a record of the bankruptcy on their credit report for up to 6 years from the date of your discharge.
However, you can begin rebuilding credit immediately upon your discharge (and even before).
Getting A Discharge From Debt
Once you receive your bankruptcy discharge you should contact the credit bureaus and make sure your credit reports are accurate.
It is not uncommon to find errors on your report.
Make sure the credit bureaus are aware of your discharge.
Rebuilding credit with errors on your report will be much harder.
If you find errors on your report you can supply the credit bureau with a form to correct the errors.
Secondly, it would be wise to get a secured credit card.
A secured credit card has revolving credit with a limit set by the amount you deposit with the card company to “secure” your credit.
By using a secured credit card you can make small monthly payments each month to build a positive credit report with a solid payment history.
After several months this will help you improve your credit score.
Establishing good credit is also possible by getting a loan for an RRSP.
By borrowing a small amount with a 1 year repayment term you can establish credit while also increasing your investments and offering you a tax deduction.
Many people worry about qualifying for a mortgage after filing bankruptcy.
Fortunately it is possible to get a mortgage with a bankruptcy on your credit report.
We find that often people can qualify for a mortgage at competitive terms within 2 years of their discharge from bankruptcy, if they work hard at rebuilding credit.
Going bankrupt will reduce your debt, so by working at rebuilding your credit, you can actually be qualified for better mortgage terms within several years of getting out of bankruptcy, as your unsecure debt levels will be reduced to zero.
Your lender will look at your credit score and your income vs debt levels when determining whether to approve your mortgage.
If the lender sees you have taken steps to improve your credit, there is a very good chance you will get the mortgage you need for the house of your dreams.
Filing bankruptcy is often a necessary step for people with bad credit to begin to rebuild their credit.
How Do Debtors Feel After Going Bankrupt?
Many people feel that their life improves after they go bankrupt.
Filing bankruptcy will put a stop to collection calls, wage garnishments and will ease the burden of crippling debt.
Many people feel a relief once they have filed for bankruptcy.
Additionally, your trustee will also work with you to explore the causes of your bankruptcy and give you tools for better money managent in the future.
Taking these lessons, life after bankruptcy is often much better than life before the bankruptcy.