Bankruptcy Loan

Well, you have enjoyed spending the money partying, having a good time and buying all that money could buy, or you have been forced to spend all your money into some emergency that you could not foresee. All in all, the bottom-line is that you are deep in debt and see no alternative to repay it in the near future. Should you file for bankruptcy? This is always the last resort since this would stay on your credit report for the next decade. Well, how does that matter, and what about a bankruptcy loan?

Before being accepted for a bankruptcy loan,  you will need to explain your tangles to the bankruptcy judge which could be nothing less than embarrassing, to say the least. You will need to have ready some real good answers to tough questions that you may be asked. Next comes your credit. You can keep only those credit cards which were paid in full before you declared bankruptcy. You are going to lose the rest of them. The woes are far from over, you will not be able to get a new loan, mortgage, credit cards or even jobs in some cases (since many employers think that you lack self discipline and thus got yourself bankrupt). And remember, this is no easy way out of student loans, taxes and child support; these will not be waived off as debts.

To top it all, your credit report is maligned for the next decade and you cannot really swing financially although you may earn a fortune during the period.

There certainly must be a way out of this. Yes, you can still get a loan after bankruptcy, called the bankruptcy loan. The purpose of this bankruptcy loan is to get you back on your feet and get your finances in shape. This loan is available only after all the creditors are paid and the file is dismissed. Under chapter 13 this would mean that your creditors must be paid in full before you can apply for a loan whereas under chapter 7 it would mean that you will need to wait for a minimum of two years before you can opt for a bankruptcy loan. From hereon, all you would need to do is to pay your bills on time and maintain a credit card properly. Once this track record becomes proven, you can always get references form your creditors to prove your credit worthiness on your way to building your finances back.

One word of caution is that don't get lured by lenders who offer to pay off your creditors through a bankruptcy loan while you are still in bankruptcy. Remember, your cant borrow your way out of debt.