Wednesday, March 28, 2012

How to recover after a bankruptcy

I am a bankruptcy attorney in Phoenix, Arizona ($995/Chapter 7), and after I help someone file Chapter 7 or Chapter 13 bankruptcy, they wonder what to do next to get their life back on track. Will they be eligible for credit? How soon can they buy a house? What about a car? What happens to their credit score? Will anyone find out about their bankruptcy? Will their employer find out and will it hurt their current job or future employment? How long does a bankruptcy last on your credit report? How do they keep from falling in the same rut as they did before? Bankruptcy laws only allow you to file bankruptcy once every few years.

Usually after someone's bankruptcy is discharged, they start receiving credit offers in the mail as soon as a couple of weeks. They're not the greatest offers - they may be for a $500 limit credit card with an 18% rate - but at least it's a start. Usually two years after a bankruptcy discharge you can buy a house. The FHA and a couple other lenders will finance people that soon. Buying a car is also quite easy, some lenders will even finance you DURING your bankruptcy! It is very difficult to find out if someone has filed bankruptcy, because although it is a public court record, those records are kept in a password-protected database by the federal courts. Generally only attorneys who practice law in those courts have access to it. I have never found any record of my clients' bankruptcies doing a Google search.

In most situations, your employer will not be notified of your bankruptcy (generally only if you owe your employer money or your paycheck is being garnished). If they find out, federal law prohibits them from taking any action against you. They also cannot fire you for having your paycheck garnished the first time, although if there is a second garnishment things can change. A potential future employer may find out about your bankruptcy if they run a credit check on you. They *may* choose not to hire you based on a bankruptcy. However, they may also choose not to hire you based on just having bad debts, so filing a bankruptcy may not make things any worse. When a bankruptcy shows up on your credit report, it erases all of the bad debts from showing up anymore. A bankruptcy lasts on your credit report for 7-10 years, but most people's credit scores start improving by 100 points within a year after their bankruptcy.

I advise my clients after bankruptcy to check out a book called "Bounce Back From Bankruptcy," by Paula Langguth Ryan. It walks you through all of the steps needed to get your life back to normal. If making enough money is something that you've struggled with, I recommend successful businessman Chris Widener's Twelve Pillars of Success seminar. He is coming to Arizona on April 7 and will be giving a seminar in Scottsdale for $37. You can register for it here. Bankruptcy may get you off your feet for awhile, but you CAN recover, and it will not take years to do so.

The Alexander Bankruptcy Law Firm provides low low cost Chapter 7 and 13 personal bankruptcies. $995 Chapter 7 or $2500 Chapter 13 bankruptcies plus court filing fee. Free consultation with a compassionate attorney who will handle your case personally. Call 24/7, available to meet with you around your schedule. 602-910-6812. Conveniently located in Central Phoenix along the Camelback corridor.

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