Charlotte Bankruptcy Lawyer Bryan W. Stone of Arnold & Smith, PLLC answers the question “Can I get credit after filing personal bankruptcy?”
What is the first thing a person should do after bankruptcy? Get a credit card!
Not really, but you should at least think about opening some new credit lines, according to Gene Melchionne, a Connecticut-based bankruptcy attorney. Think about credit, but “Don’t go crazy trying to get new credit right away,” Melchionne advises.
The nice thing about emerging from bankruptcy, Melchionne says, is that you no longer have to worry about the debts that were dragging down your budget before bankruptcy. On the other hand, your credit score is in the gutter, and you need to take on some credit in order to start to bring the score up.
Melchionne suggests starting with a small credit limit and monitoring credit card use closely to make sure you can pay off the entire balance each month.
Establishing some credit—no matter how small—dovetails with monitoring your credit reports regularly. You won’t know just how far your credit score is going to fall until three-to-six months after being discharged from bankruptcy, so there isn’t any need to check your score until then. Once three-to-six months have passed, you can obtain your credit scores once for free from the three major credit reporting agencies. The agencies give consumers one free report per year.
It is important that you check your credit report at least once a year to make sure that all of the debts that were due to be discharged from your bankruptcy have been removed from your report. As reported in this blog earlier this month (Read: “Banks purposefully ignoring bankruptcy discharges, still trying to collect “zombie” debts”), bankruptcy judges and lawyers have accused banks and lenders of purposefully failing to erase debts from consumer credit reports that were discharged in bankruptcy. The banks and lenders are still trying to collect on the debts, even though consumers have no legal obligation to pay them once they are discharged in bankruptcy. Unless creditors are hounding you, you won’t know if you have any “zombie” debts on your credit report unless you check it.
If you do find “zombie” debts or other matters on your credit report that should have been discharged with your bankruptcy, you may need to demonstrate that these debts should have been taken off your report to a collector, a bank, a lender or someone helping you with your case. It is important that you keep all of your bankruptcy paperwork, in case one of these issues arises. If it does, you will be able to produce the evidence you need to show a debt has been discharged.
Also, when you do seek new credit after bankruptcy, many banks and lenders like to see a copy of your bankruptcy papers when assessing your creditworthiness. If you keep this information on hand, it may streamline the process of establishing a new, credit-worthy You!
If you find yourself needing the services of a Charlotte, North Carolina bankruptcy attorney, please call the skilled lawyers at Arnold & Smith, PLLC find additional resources here. As professionals who are experienced at handling all kinds of bankruptcy matters, our attorneys will provide you with the best advice for your particular situation.
About the Author
Bryan Stone is a Partner with Arnold & Smith, PLLC, where he focuses his practice on all aspects of bankruptcy, including: Chapter 7, Chapter 11, Chapter 13, home loan modifications and landlord-tenant issues.
A native of Macon, Georgia, Mr. Stone attended the University of Georgia, where he earned a BBA in Banking and Finance, and Wake Forest University School of Law, where he obtained his law degree.
Following law school, Mr. Stone relocated to Charlotte, where he currently serves as Chair of “Bravo!” – a young professionals organization associated with Opera Carolina – and founded the University of Georgia Alumni Association of Charlotte.
In his spare time, Mr. Stone enjoys perfecting his barbeque skills for the annual “Q-City BBQ Championship” and playing softball in the Mecklenburg County Bar softball league.
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