Imagine a world in which the phones are quiet, the mail box is not full of past due collection letters, and you are not worried about how you are going to make your mortgage payment or buy groceries. It can happen to you. At Kain & Scott our Roseville MN Bankruptcy Attorneys help thousands of Minnesotans every year get exactly that. After Filing Bankruptcy the fear and anxiety of it quickly dissipates into a wondrous world free from overwhelming debt. Our Roseville MN Bankruptcy Attorneys never hear clients regretting to File Bankruptcy. Rather, they regret waiting so long to file bankruptcy. Once you get on the other side of this thing, this overwhelming debt, life is so magically beautiful and less stressful.
The Cure To Overwhelming Debt & Financial Stress
Sometime will speak for myself when I say I really hate taking medicine especially liquid medicine that tastes really gross. However, if that is what it takes to get rid of whatever is ailing me, that is what I intend on doing! Bankruptcy is much the same way. It’s a medicine you would rather not take but if it cures your overwhelming debt, and relieves your anxiety, take the medicine!
Bankruptcy & Life After
I often have clients ask me, what should I do about my life after bankruptcy. It’s a question that often gets asked plaintively because many people don’t know how to live without overwhelming debt! The first thing you should do is pat yourself on the back and be proud of yourself for tackling such a big problem in your life. It takes courage and anxiety to face overwhelming debt and you should be super proud of yourself for facing it head on!
I really feel bad for the people who can’t face it and live years in misery. There is no telling how many marriages end, how many lives end, and just how many people live with overwhelming debt and the physical and mental anguish that goes with it. I feel for everyone of them. For those of you who made it to the other side, you know how liberating it is and how much better you feel. Bankruptcy is not the end, it’s a new beginning.
A Way To Improve Your Credit Score
My Roseville MN Bankruptcy Attorneys and I get asked after bankruptcy what do I need to do? What do I need to do to improve my credit score? Quite often. Most people don’t realize the very act of filing a bankruptcy and receiving a bankruptcy discharge usually improves your credit score. Why you ask? Because upon discharge, you have less debt than you did when you filed the bankruptcy. That is why I typically tell prospective clients, if your credit is bad, or if you see the freight train coming down the tracks, and is about to mow you over, what is the difference?
The list of things to do following the receipt of a bankruptcy discharge:
1. PULL YOUR CREDIT REPORT(S) AND CORRECT MISINFORMATION
I would wait about 30 days after getting your bankruptcy discharge and pull all three of your major credit reports. Waiting 30 days after discharge gives the credit reporting companies time to update their records. I would pull Transunion, Equifax, and Experian.
In a perfect world, the credit reports should be reporting the bankruptcy information on your credit reports. I have news for you though: it is not a perfect world. Often times, clients find mistakes on their credit reports. The most common mistake we see if a creditor that was listed on their bankruptcy schedules still shows up on their credit report(s) as a delinquent account.
What we tell clients to do is pull all three of your major credit reports and review them carefully for any incorrect information. You have the right to correct misinformation on your credit report(s). Typically, I will tell a client to take one dispute form (you can find these on line) for each credit reporting agency and list on one side what they are reporting. On the other side, you will state why this information is wrong ie I filed a bankruptcy and listed this creditor on my bankruptcy so they should be removed from my credit report.
Always supply information and proof of what you are saying to the credit reporting agencies. For example, if Sears is still showing up negatively on your credit report, send the credit reporting agency a copy of your bankruptcy schedule showing Sears listed as a creditor and a copy of your bankruptcy discharge.
Once disputed, the credit reporting agencies have 30 days to remove the incorrect information. If they don’t remove the information, call your bankruptcy lawyer immediately.
2) TAKE OUT A FEW LINES OF CREDIT
Yes, it is true. You have to get back into the game. You have to prove to creditors you can take out a line of credit and make payments on the debt, even pay it off early. I tell clients all the time that you should get a credit card after a bankruptcy discharge. Why? For many reasons but how else do you reestablish your credit without getting credit? It’s like an oxymoron- you have to get the credit to improve your credit.
You don’t have to get a huge line of credit mind you. A credit card without limit of 2k is about all you ever really need. Use the credit card, charge things, and then expect to pay the balance off each month. Some suggest that you don’t pay the balance off each month but make much larger payments than normal to show that you have a strong ability to repay the debt - more than just the minimum payments.
Either way, improving your credit is going to require that you get back in the game of credit. Make it a habit of paying the credit card in full each month. That way, you will know that the purchases you make that month will have to be paid by month’s end. It will cause you to think a little harder about a purchase if you know how big the bill you will have to pay at month’s end will be.
The other reason to have and to carry a credit card is pure convenience. You have heard that it is nearly impossible to book a hotel or rent a car without a credit card. Well, that is true. And, it’s one of the bigger reasons to have a credit card.
I am also not a user of a debit card. The thought of someone having that kind of access to my bank accounts makes me cringe. I have heard the horror stories of friends and family who have used debit cards only to have money missing from their accounts. Oh sure, as far as I know they all had their money returned but at what inconvenience and cost to them in their time and expense?
No way- for me, I would prefer to use a credit card, and if something is missing or there are suspicious charges, they can be disputed and it’s up to the credit card company to use their resources to investigate the problem and fix it- not me.
Of course, the credit cards can also be a small back up in case of an emergency. If all four tires need replacing and now, I can get that done and still go to work and earn a paycheck.
3) Make SUre YOu Have HEALTH INSURANCE
I remember when I was in college, I went all four years without health insurance. I was playing Russian Roulette with my health- not smart. At the time, the cost of health insurance was not affordable and even if it was, at what expense? Would I have to give up drinking beer? No way. Would I have to quite smoking cigarettes? No way. I am not saying this was smart but I grew up in an era when you turned 18, your parents couldn’t carry you any longer on their insurance. At the tender age of 18, you were on your own.
Being financially unsophisticated, my first really stupid financial move was to not find a way to pay for health insurance. I am sure I could have gotten a policy cheap- maybe 50-100.00 a month but that didn’t matter to me.
Enough already, after a bankruptcy discharge, please try and make sure you are covered by health insurance and a good policy of health insurance. Everyone should know their individual out of pocket medical expenses and their family maximum out of pocket medical expenses. If the policy you carry through an employer is complete crap, check into adding another one. So many of these policies care enormous out of pocket expenses before the health insurance company will cover anything. It’s pathetic really, but it’s a way in which they can keep health insurance premiums lower.
Keeping medical expenses under control is enormous challenge for anyone. The insurance companies write the policies we don’t. I personally am outraged that getting sick can result in a bankruptcy anyway. When you are sick or on death’s door should you really have to worry about cost?
4) Live Simple And Modest
Ah yes, lifestyle choices. It does play a roll in the financial stress that we all feel. Life really is a series of choices, one after the other. While no one makes perfect choices all the time, you do hope most of your choices are good ones. How many of life’s stressors can be reduced by ourselves? The answer is most of them. How? To me the answer is- making up your mind to live a life that is simple and modest. That doesn’t mean boring and without risk. Quite the contrary. A life that is simple and modest financially means really that you intend to keep more of what you earn.
I remember hearing somebody say once that the definition of unhappiness is “not knowing what you want but trying like hell to get it.” If you don’t know what it is that drives you, motivates you, springs you out of bed in the morning with vigor and drive, how will you get where you want to go?
For most of us, we say we want a simple life and yet our lives are extraordinarily complex. Financially speaking, knowing the difference between a need and a want is huge. I grew up in a small town with 2 parents and 9 children total. My dad was a factory worker and my mom was a stay at home mom. Our home was modest, we had one vehicle, and we certainly didn’t live a luxury lifestyle! But, I have fond memories of my childhood in small town USA with a big family and not a lot of money. We could easily tell between a need and a want.
Poverty is very humbling indeed. My experience is poverty is humbling and being humble is one of the keys to a happy life. Again, this does not mean I am telling you to take a vow of poverty. Quite the contrary, you should aspire to do great things and follow your core values always- and yes, make as much money as you can! What I am saying is that you should not let money, or the lack of it, stop you from living a life of extreme humility.
The Life After bankruptcy
The Life After Bankruptcy: The Light at the End of the Tunnel discharge is beautiful! Overwhelming debt causes marriages to fail, health problems, and unnecessary stress. I am humbled by the courage and anxiety it takes for people to face an overwhelming debt problem. But, once you get a handle on this, and get yourself on the other side of this, relationships mend, health improves, and the stress is lowered significantly.
We all want to pay our bills. However, when the waves of the ocean take you out and knock you down, and jeopardizes your family’s well-being, it is time to find out if bankruptcy is the right choice for you. For many, it is. For some, it is not. When you get your life back, there are things you should do to try and keep the train on the tracks. First, pull your credit reports and correct the incorrect information contained on them, if any. Second, yes, do get small lines of credit and repay them early to improve credit. Third, carefully inspect health insurance coverage and make sure you can handle a medical catastrophe. Finally, look at your lifestyle choices and determine if a change in lifestyle is necessary for you and your family.
For further information contact one of our Bankruptcy Lawyers MN today for a FREE, no-obligation Bankruptcy Consultation today!
Brainerd Bankruptcy Attorneys MN - 218-822-3300
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Roseville Bankruptcy Attorneys MN - 612-843-0523
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