Common Mistakes People Make After Bankruptcy

Common Mistakes People Make After Bankruptcy

The heavy burden of overwhelming debt can change the way you see the world. It can make you depressed and prevent you from seeing any of the good things life has to offer. At the same time, going through a successful bankruptcy can be just as stressful, except that ultimately it leads to a new outlook on life once the debt is relieved.

Sometimes, because of that positive outlook, people tend to make some common mistakes that could lead them right back to where they started. Here are some of the more common mistakes people make so that you can see them coming and avoid them if at all possible. For information about Chapter 7, click here (http://www.zerodownbankruptcy.com/Chapter-7/).

Overspending

Now that you are relieved of some of your financial burdens, you may feel as though you can do more with your money. In truth, you can. Just be careful to do the right things with it. One reason that people get into so much trouble with debt is that they turn to lines of credit in cases of emergencies.

While that is certainly understandable, it is not a good habit to develop. Rather than spending that income, now is a good time to start putting it into savings so that you have funds in case of an emergency.

Opening Unnecessary Lines of Credit

Most people think they won’t get any credit offers after their bankruptcy is discharged. Nothing could be further from the truth. Creditors know that consumers are anxious to begin building their credit after bankruptcy, and they also know it’ll be years before you can legally file bankruptcy again. Because of this, creditors are more than willing to offer you a credit line—but with high interest rates. It may be a good idea to open one or two lines of credit to begin rebuilding, but don’t accept every offer that comes your way. Other tips include the following:

  • Many people open lines of credit for expenses they already pay for every month, such as gas, and then fail to pay the balance in full each month. Putting these expenses on a credit card is fine, but you should put back the cash you would have paid out for those expenses and then use it to pay the bill in full each month.
  • Try to avoid applying for credit at multiple places within a short period of time. Each time your credit report is reviewed it is noted as an inquiry, which can end up decreasing your credit score. You could end up making your credit score worse just by applying for too many accounts.
  • Always keep your balances low. Maxing out credit cards can also decrease your credit score.

Bankruptcy gives you a clean slate to start anew, but it’s extremely easy to fall into the same bad habits and make the mistakes that led to bankruptcy in the first place. Start out slow, and you’ll be able to rebuild a positive credit rating and healthy financial future as a result.

Please share this post online to help prevent others from making these common mistakes after bankruptcy.

Related Links:

Florida Bankruptcy Attorneys

http://www.zerodownbankruptcy.com/

Chapter 13 Bankruptcy

http://www.zerodownbankruptcy.com/bankruptcy-lawyer-st-petersburg-florida/Chapter-13/

Florida Chapter 7 Bankruptcy Lawyer

http://www.zerodownbankruptcy.com/Chapter-7/

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