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Life After Bankruptcy: Guided Steps to Rebuilding Your Credit , Finances and Emotions

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Bankruptcy is not the colossal social stigma it was 40 or 50 years ago. Today this financial process allows many people an option to renew their credit score and place their financial affairs in order. The important thing to know is that there is a way to come back and rebuild your financial plans.


After watching your carefully laid budget plans and investments mount to a bankruptcy credit card issue, it is easy to become disheartened and feel like a failure. Those in the psychological profession have equated this level of stress or anxiety to the level one would feel on getting a divorce or suffering bereavement. The following 5 stages of grief were established by Elizabeth Kubler-Ross and can apply to your initial reactions to your financial decision.

You May Experience Denial: You may tell yourself that your situation is not really that bad and things will get better. You may even cling to the possibility of a future raise or windfall that will solve your issue.

You May Experience Anger: When this falls through as these obscure notions often do, the impulse will be to lash out angrily at those you feel were responsible for your misfortune. This could be a former boss, rival, spouse or even the economic system as a whole.

Be Careful With Bargaining: Beware of making a bad decision that can potentially land you into hotter water. Taking on a part time job or launching another cash-generating scheme like purchasing a list of lottery numbers or selling the boat and heading to Atlantic City.

You May Experience Depression: After the bargaining plans fall through as these desperate attempts often do, it is natural to feel a wave of depression and feelings of despair. When the individual believes, they have no other recourse and quits fighting, they will often consider looking for help.

Acceptance: In the end, there will be a calming feeling of acceptance when you realize that you have finally made the decision that will get you out of this present situation. While this may not be the situation you were looking for, you still have the house and car and any other assets that have been spared.

Work With an Experienced Attorney: Once you have warmed up to the notion that due process is the route out of your predicament, your experienced attorney should help guide you through the process and understand what the process involves. This will be important assistance as you will also be shouldering a considerable weight of stress and anxiety that will make clear thinking a tough call.

You May Need to Educate Yourself: It is the nature of fear that makes things we don’t fully understand seem frightening or insurmountable. You can cancel out this negative effect by studying up on all the particulars of the process and what will be required to rebuild your credit scores. This way you will be approaching the process from a knowledgeable perspective and this always gives the best results.

Consult a Professional or Clergy: For many, working through the emotional side of the situation can be especially difficult, for this reason many have chosen to speak with a professional about the feelings they are experiencing. There are many services in the community that can provide these services, and it is imperative that one take advantages of the resources available to them.

Obligations to the Court: Filing does not necessarily solve the entire issue. This is where you will need the attorney to mitigate the harshness of any repercussions. Each state has its own set of rules that decide what can be eliminated from the debt and what cannot. Some of the more important areas that should be considered might not be discharged include.

  • Income Tax
  • Real Estate Properties
  • Student loans
  • Fraud Victimization
  • Lawsuits for Liability
  • Recent Advances on Credit Cards

Reaffirming Debt and your Responsibility: After the filing you will need to discuss further responsibility with your lawyer. You will be asked to sign an agreement with your remaining debtors to pay off any remaining debts. The total debt is often negotiated down considerably. Included in this are usually new terms of payments for the debts that remain.

Final Notes: The important takeaway here is this, filing can help reset your financial responsibility and credit scoring. The thing that must be done now is to take stock of your future and plan a new approach to your spending habits. Consider gathering your information about your current financial situation, budgeting system and regular income. Consider going over this information with a qualified financial advisor for tips on better managing habits. If you have made it through the process it would be a shame to fall in it once again through poor spending habits.