For both businesses and individuals, it is not uncommon to encounter financial difficulties at some point in life. Especially when your lenders are on your back. Maybe you’re facing foreclosure threats, and your income doesn’t seem to meet your financial obligations anymore, filing for bankruptcy is one of the best ways out of this hectic situation. But then again, it doesn’t have to be the end of the road for you. There is life after filing for bankruptcy, especially if you equip yourself with expert financial advice and work towards building credit anew.
Most likely you’ll close any bank accounts, credit card accounts, and loan accounts that are affected by the delinquency you’re filing for bankruptcy against. As a matter of fact, most legal financial experts recommend closing such savings/checking accounts and opening a new one before filing. But the big question is, how do you go about opening a new bank account after you’ve filed for bankruptcy chapter 7, 11, or 13? Well, here are 5 tips to setting up a bank account after filing for bankruptcy.
- Keep Tabs with Your Credit Report
The main reason you filed for bankruptcy in the first place is to seek a fresh financial start. However, the fact that the process might have affected your creditworthiness isn’t to be ruled out. It obviously affected your credit score, and rebuilding credit should be among your topmost priorities when opening a new bank account. Needless to mention, this will require you to stay updated but regularly checking your credit report and in an attempt to seek ways to best improve it.
- Develop A Savings Mentality
To make the most out of the opportunity you get from a successful bankruptcy case, it pays to develop an aggressive savings mentality, especially if you got in trouble for borrowing more than you can pay or mismanaging borrowed funds. Now that you have a lesser burden on your shoulder, take this opportunity to save as much as you can for emergencies, future investments, and your personal and financial growth.
As a matter of fact, opening a savings account can be easier after filing bankruptcy compared to a checking account. Nonetheless, you’ll want to start small and be realistic with your savings ambitions. You can even consider setting up automatic/direct deposits from your paycheck to your savings account or debit card.
- Think About a Future Personal Loan
Personal loans are a great instrument to rebuild credit. Especially if your current income is substantial, you can qualify for a personal loan even after filing for bankruptcy. However, different lenders will have different qualification criteria, so be sure to do your homework well and figure out the best banks and credit unions that provide you with the opportunity to open a bank account without having to wait for the 5-year period that it takes for delinquency/bankruptcy entries to be cleared.
You’ll be surprised that some of these institutions will also consider giving you a personal loan upon meeting a certain threshold of creditworthiness. In this case, https://letmebank.com/best-second-chance-banks/ can be a good place to seek more information.
- Consider a Secure Bank Account
Most banks and lending institutions are required to disclose and share debtor information with credit bureaus. After bankruptcy, the chances of being denied a new account can increase drastically. However, this may vary from one to another, and especially if your relationships only went sour with one bank or lender, others may be willing to accommodate you. Nonetheless, sometimes you’ll want to opt for prepaid debit cards to start building your creditworthiness and work your way up.
- Live Within Your Means
You just can’t put this across any better. Whether you’re facing, dealing with, or have already filed for bankruptcy, you have to live within your budget. Otherwise, the new account your open will prove to be an added expense that you most probably don’t need right now! Stay abreast with your bills, remissions, and utility payments. Do not spend more than you earn!
With the above few tips, wish you the best of luck in your post-bankruptcy financial journey!