ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Borrowing after Bankruptcy – It Can Be Done

Updated on March 14, 2013

Filing for bankruptcy was one of the most difficult decisions of your life. Now you need to rebuild your credit in order to move forward with your life and in order to do so you’ll need to open a new credit card account or take out some type of new loan. There are several things you can and should do before borrowing again to ensure that you don’t find yourself in the same overwhelming situation you just escaped from.

What Can You Afford?

The first thing you should do, before even applying for a loan or credit card, is to review your budget to determine exactly what you can afford. The numbers you come up with need to be exact as estimations are bound to get you into trouble. Create a budget by comparing the exact amount you spend on bills and expenses to your monthly income. What amount is left over at the end of the month?

Once you know how much money is leftover you’ll want to determine exactly how much money per month you’ll need to spend if you do take out a loan. We’re assuming, in this case, that you are taking out a loan or opening a credit account for a very specific reason so this figure should be easy to determine. Is the amount of your monthly loan payment less than what you have left over in your budget? If so, you can afford the loan.

When you review your budget you should leave a cushion for emergencies. If taking out a loan means you’ll never be able to put money into savings or that you will not have any money left after paying all of the bills than you really can’t afford to move forward.

Loan Agreements & Hidden Fees

Sadly, many credit card and loan companies use the fine print in their agreements to trick consumers. You’ll want to take special care to read the agreement in its entirety before signing. As you read, watch out for the following:

  • Yearly cardholder fees,
  • Overdraft fees,
  • Late fees,
  • Charges for paying early, and
  • Fluctuating interest rates.

Many of these fees may seem trivial but over time can result in your loan or card payments increasing significantly, blowing your budget completely out of proportion. Understanding when you might be charged fees or when and why your interest rates might change will help you to plan in advance and determine if the loan is the right one for you.

Avoiding Predatory Lenders

Sadly, there are quite a few unscrupulous lenders looking to take advantage of individuals who don’t really understand lending practices and how they work. They’re especially looking to take advantage of people who have just filed for bankruptcy – knowing that your slate has been wiped clean and believing you have money to spend. They’ll trick you into taking out a loan to rebuild your credit and then switch you to another program, flip your loan to another company, or take part in some other practice that will result in you paying more than you had intended.

You have the right to rebuild your credit after bankruptcy. Make sure you read every document you receive before making a final decision and, if you need help, consult your bankruptcy attorney for advice.

Comments

    0 of 8192 characters used
    Post Comment

    No comments yet.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: "https://hubpages.com/privacy-policy#gdpr"

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)