What Types of Loans Can I Get After Bankruptcy In Ohio?
The decision to file bankruptcy can be a difficult one. One has the legal responsibility to handle their debts, and they are faced with the emotional strain of not being able to keep up with them. Many people also worry about their future after declaring bankruptcy because it is a public record that can affect an individual’s credit score for several years. Many people wonder about what types of loans they will be eligible for after they file for bankruptcy. This article discusses the different types of loans available for those who have filed for Chapter 7 or 13 Bankruptcy.
The Easiest Loan to Obtain After a Bankruptcy
Car loans are the easiest and most common type of loan to get after bankruptcy. One will be able to find car dealerships that offer financing for those who have recently filed for bankruptcy. Car lenders know that once one file for bankruptcy, their credit score is likely meager, which means they would not qualify at any other dealer or bank, so they make it easy on them by offering high interest rates and shorter terms (such as 36 months). However, if this makes a difference in getting back behind the wheel, one needs to take advantage of their services. Additionally, making consistent payments on a car loan can help improve your credit score.
Getting their credit back on track is something that many people want to do after filing for bankruptcy. It can be challenging since creditors are not required by law to approve people again, which means that even if their Chapter 13 or 7 has been discharged, then some companies may still not be willing to lend. However, many credit card companies view consumers who have recently filed bankruptcy as good risks, since a chapter 7 discharge can only be obtained once every eight (8) years. Many lenders offer secured credit cards and/or credit cards that have low limits at slightly higher interest rates. Making charges on a credit card and paying the balance each month can be a good way to rebuild your credit.
Hardest Loans to Get After One is Declared Bankrupt
Unfortunately, home loans are the most difficult type of loan to get after bankruptcy. Most lenders feel as though those who have gone through this hardship don't make good enough financial decisions t make a major credit purchase such as a home loan. Since these loans involve large sums of money, creditors are especially concerned about people being able to repay their debts. If one's dream is to own a home through a mortgage, then typically you need to wait 2-3 years prior to applying.