After receiving a discharge from the bankruptcy court in New York, most prior debt will no longer exist and debtor keeps any money acquired after discharge.
To prevent getting into bankruptcy again, make a budget to control impulses to overspend. Save cash to become independent of credit until the big purchase items come along. The credit counseling course a debtor takes prior to filing bankruptcy assists in starting a budget.
Calculate the expenses. Take notes on every dollar spent during the week such as $3.00 dollars for Starbucks coffee, $2.00 for a newspaper. Go over spending at the end of each month. Identify non-essential items or items that could have been purchased less expensively such as using coupons for groceries.
Understand spending habits. Once an individual breaks even, stick to the budget to rebuild credit.
It takes about two to three years to rebuild credit after a bankruptcy. To raise a credit score, have few credit cards, and keep them for a long time. Most creditors require a steady employment history, at the same occupation, or with the same employer, after bankruptcy.
Creditors look to see whether a person pays bills on time. Creditors prefer extending credit to an individual who has filed bankruptcy with a good payment record after the discharge than a person who has not filed bankruptcy with an inconsistent payment record.
Individuals may be shocked to receive credit card offers after filing bankruptcy. They are welcome customers because they cannot file bankruptcy for another eight years. To rebuild credit, get a secured credit card, or work with a neighborhood store to buy items on credit. A person has difficulty getting credit if s/he pays only cash, and does not have a credit history. Pay any credit cards on time to trigger positive entries for the credit file.
Watch out for cards that are not credit cards but look like credit cards. These cards allow individuals to use cards only to buy items from their catalogues. The items in these catalogues
may be overpriced and not of good quality. Payments are not reported to credit agencies for building a credit history.
To learn more ways to rebuild credit, consult with an experienced New York bankruptcy attorney.