Bankruptcy can be a nightmare or a relief after nightmare for many. There are a few important events that occur after bankruptcy. Such events can be listed as follows-
- Liquidating or preventing the liquidation of assets
The first step after bankruptcy is to either prevent the assets from liquidation or to notify the lenders/bankruptcy trustee to liquidate the assets. If the bankruptcy filer must prevent an asset from being liquidated, this is the critical moment to do so, or it can be liquidated, or the lien might be exercised by the lender on the same. For this, the bankruptcy filer should either claim an exemption or have some understanding with the lender for clearing previous dues and allowing for a revised payment structure. This kind of understanding is more commonly seen in chapter 7 of bankruptcies.
- Cooling period
To avail of a bigger loan, especially unsecured, or for a purchase of a car, house, or any other expensive essentials or luxuries, the bankruptcy filer might have to wait for a period of 7-10 years. The waiting period could be 10 years for a chapter 7 filer and 7 years from the date of discharge for a chapter 13 filer. The other seasoning period is for the filer to avail a discharge. There is no limit on how many times an individual can file for bankruptcy but there is a seasoning period for the filer to avail discharge. The seasoning period to avail discharge after filing bankruptcy is usually 7 years. It might vary slightly depending on circumstances and other aspects.
- How to take financial reins into your hand after bankruptcy?
It is important to let bankruptcy have a positive impact on financials once it is completed. That is the primary reason why the bankruptcy course includes credit counseling and financial management courses. It is not wrong to make mistakes however, failure to correct and repeat of same mistakes can prove disastrous. It is important to follow certain steps after bankruptcy to take advantage of the clean slate and to proceed towards prosperity in terms of wealth in the near future-
- Taking steps to maintain a job and consistent source of income to sustain a basic lifestyle
- Not taking unnecessary credit and minimizing the use of credit for luxury or unnecessary purchases
- Paying all kinds of bills before time and ensuring nothing piles up
- If things are not working, seek help earlier then later
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