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Should the stigma of bankruptcy hold you back?

On Behalf of | Sep 27, 2021 | Bankruptcy

Something that commonly holds consumers back from taking drastic steps to address their debt is that they worry they will make the wrong choice or that their choice will negatively affect their financial affairs permanently. Fortunately, that does not have to be the case with bankruptcy. Though this debt relief method is not for everyone, it could help qualify Arkansas residents get their affairs back on track.

If the idea of seeing a permanent tank in credit score or never being able to get a loan is preventing people from considering bankruptcy, it may be useful to know that these outcomes are not typical. In fact, completing bankruptcy and making conscious efforts to improve one’s credit could result in a higher credit score in the future than someone may have now while struggling with overwhelming debt. Of course, it does take work to reach an improved financial situation.

Some ways that individuals could help themselves rebuild their credit and finances after bankruptcy include the following:

  • Creating a budget that has saving money as one of the goals
  • Paying bills on time, opening secured lines of credit, obtaining credit builder loans and having utility bill payments reported on one’s credit report
  • Maintaining steady employment
  • Creating an emergency fund

While these steps may seem simple, they can have significant benefits on the financial affairs of Arkansas residents moving forward. As a result, bankruptcy may not warrant the stigma is often gets. If the possible negative effects of Chapter 7 or Chapter 13 are preventing individuals from filing, they may wish to discuss their specific situations with experienced attorneys before writing off this possible relief option.