Bankruptcy Can You Re establish Credit And Get Rid Of All Debt.

By Christy Thompson

That really is more about you and less about acquiring credit. If you file bankruptcy and dont take out any more credit cards, you dont purchase a house or a car, and then you know you will have the credit that you had after you filed bankruptcy, which is not good credit.

Its a good idea to go out and establish credit immediately. What I mean by immediately is right after youve filed your bankruptcy.

Good credit is two years of solid credit. So directly after bankruptcy, youll have poor credit. What youll want to do is acquire secured credit cards, maybe get some store credit thats reported. Then within six months, youll improve your credit. After that, youll get better credit, lower interest rates, and unsecured credit cards. Within two years, you should have very good credit.

There are lot of stores and banks that actively market to people who file bankruptcy. They actively market to people who have filed bankruptcy. So you can acquire a secured credit card and, ultimately, an unsecured credit card, and you can really build up your credit after filing.

A lot of people need to look what is their credit right now? If they havent been paying their bills or theyre just too overburdened and are making minimum payments, its questionable whether their credit is really that good right now anyway.

So yes, you can absolutely establish credit after bankruptcy.

Is it true that bankruptcy gets rid of all debt?
No. That is not true. Even though bankruptcy is a great way to relieve debt, certain debts cant be discharged. Meaning they cant be eliminated.

Say, for example, youre responsible for paying child support. That will not go away. In Arizona we have spousal maintenance. Thats something else that youre going to have to pay. If you have been ordered by a court to pay somebody restitution for a crime or civil disobedience, that wont go away.

Some taxes can be discharged, but some taxes cannot be discharged. So you may be responsible for your taxes. If you embezzled or if you defrauded someone and obtained a loan, those cant be discharged.

A lot of student loans cannot be discharged. When I say a lot, there are limited circumstances where some can.

But that becomes a bit of a list there. For example, that someone acquired a DUI, driving under the influence, and there are fines and penalties attached to that...those could not be discharged in the bankruptcy.

So for all the debt that can--credit card debt, house debt, medical bills--theres a handful of debts that cannot.

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About The Author
To get additional information on debt settlement and bankruptcy options please visit our web site. We would also like to offer you a free online debt evaluation. You can claim your free online debt evaluation at http://arizonalegaladvocacy.com.

Christy Thompson, your Chandler Bankruptcy Lawyer