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 Filing for bankruptcy is a difficult decision. However, it is
possible to recover from the poor credit rating after you are
discharged from bankruptcy. To help you accomplish this we have
as seven step plan:
Complete your bankruptcy in the shortest time you can.
If you are a first time bankrupt, you qualify for an automatic
discharge from bankruptcy at the end of nine months. To be
eligible for this quick discharge, you have to make monthly
payments and attend your credit counselling sessions. The
sooner your bankruptcy is completed, the sooner it will disappear
from your credit report, so complete all of your bankruptcy
duties as soon as possible.
Common Sense. Think before you spend your money, ask
yourself ‘do I really need this right now’ 9 out
of 10 times the answer will be no. Each month you receive
a bank statement, look at it. Look at the deposits and look
at the withdrawals. Do you know where all those instant teller
cash advances went?
Start saving money. Money is opportunity, to borrow
again, you need to prove that you can handle money, and the
best way to do that is to show that you have some! Open a
saving account and start depositing. You were making monthly
payments to the trustee during your bankruptcy. Now that your
bankruptcy is finished, continue making those payments, but
make them to your own savings account. Savings will be the
foundation for your future borrowing.
Get a copy of your credit report. Go to Equifax, and
Trans Union and get a copy of your credit report and check
for accurateness. If you find any errors, such as debts appearing
that were included in your bankruptcy, notify the credit bureau
immediately.
Get a secured Visa card. Start rebuilding your credit
with a secured credit card. You use your savings to place
a deposit on a credit card, the bank in turn will give you
a credit card with a matching credit limit. It shows up on
your credit report as a normal credit card, and now you have
a credit card for use when required.
Get an RRSP. If you invest $1,000 in an RRSP, your
bank will probably be willing to lend you another $1,000 to
contribute to your RRSP. That $2,000 you can contribute which
will generate a refund at tax time that will be almost enough
to pay off your loan. Your credit report then show a paid
loan, which is a positive entry on your credit report, and
you have $2,000 invested in an RRSP!
Keep saving. You will soon have enough for a down payment
on a car, and if you save long enough, the down payment on
a house. As you save more in your savings account your desire
and dependence on credit will diminish. Why borrow money when
you can use your own?
Are you a high income earner (MORE INFORMATION HERE) or do you not reside in Canada (MORE INFORMATION HERE)? |
Step 4
