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Borrowing money after a bankruptcy discharge

When residents of Western Tennessee file a petition for a Chapter 7 bankruptcy, they ordinarily look forward to the day when the order for discharge is entered, making them debt free. Another reason for looking forward to the discharge order is the chance to rebuild a credit score and obtain a fresh financial start. And, according to a recent report, a bankruptcy may be one of the best times to borrow money to begin the process of rebuilding a credit score.

Some lenders will refuse to lend money until the bankruptcy is at least one year from being completed. Others may be willing to take a risk. If a lender can be found, the loan should be paid back promptly. A second loan that is promptly repaid will go even further toward raising a credit rating.

When a person files for bankruptcy, many expenditures are postponed. An excellent use for a post-bankruptcy loan is to complete a few items on the to-do list. Again, the loan should be promptly repaid. A series of small loans that are repaid on time will help raise a person's credit score. Also, the fact that a loan applicant has no current debts may be attractive to some lenders.

Finally, a post-bankruptcy loan can be an important first step to begin the process of moving toward a person's life goals. With the weight of unmanageable debt lifted from a person's shoulders, many things that were postponed are now possible. Perhaps rehabilitation of the home or replacing a worn-out automobile can be worthwhile goals.

Anyone who is interested in a post-bankruptcy loan may wish to consult a bankruptcy lawyer for advice on the long-term effect of such borrowing.

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