Thursday, April 23, 2009

Personal Loans After Bankruptcy

Personal Loans After Bankruptcy

Is it possible to acquire a personal loans after bankruptcy? Yes you will be able to, as long as you know the process and where to go for a loan. Here are the steps you need to know to get moving.

A lot of people discover themselves in a position that they had to file for bankruptcy because they just could not afford their debts. A lot of people feel that once they've have file for bankruptcy, they will not be able to qualify for any type of credit or loans for years to come. That is just not the case! Here are a few steps that can help you with the process of getting approved for a loan or a line of credit. If you are new at your job, you actually need to hold off at lease six months before you send in an application for credit.

Your Current Employer

1. The first and most crucial step is your current employer. If you've have been on your job for at lease 6 to 12 months, you would stand a much better chance at getting approved for a line of credit or a loan. A lot of lenders will not accept your application if you have not been at your current employer for 12 months.

Credit Rating

2. All lenders use some type of minimum credit criteria before they will accept or approve a new client. Occasionally they will use your credit score or just get a copy of your credit report to review your credit activity. Before you apply to a lender, the most beneficial thing you can do is just ask the lender what is their minimum credit criteria. Or you could ask then do they work with individuals that have filed for bankruptcy? You would typically get the following responds.

A. They do not accept applicant's that have filed for bankruptcy

B. They will accept applicant's that have filed for a bankruptcy over 2 years ago.

C. They will accept applicant's that have filed for a bankruptcy over 5 years ago.

D. They will accept applicant's that have filed for a bankruptcy and has restored their credit history with at lease two unsecured lines of credit.

If you were trying to get a home loan, most lenders would require that your bankruptcy is 3 years old.

Ordering Your Credit Report

3. You can order a copy of your credit report online for free. Before applying for loan, you should have your own personal copy of your credit report. There could be some new unpaid bills that have been added to your credit report. If there are bills on your credit report that should have been included in your bankruptcy, you could write the credit-reporting agency to have them remove or you can let your bankruptcy attorney handle it for you. Once you have a copy of your credit report, you will know if you meet the minimum credit criteria for a lender before they have ordered your credit report.

Where To Apply For A Loan?

4. The best place to apply for credit is at your current bank or credit union. Call or walking to your bank or credit union and tell their loan officer that you would like to apply for a line of credit. Before you apply, don't forget to tell the loan officer that you have filed for bankruptcy. At this point, the loan officer will tell you your options, if any are available. A second option is to apply for a loan at a credit union or a small financial institution. If your credit union is connected to your employer, they could be a little more flexible than the average bank. There are also lenders that offer loans to individuals that have bad credit. You will need to go online to find a list of lenders that offer loans to people that have poor credit.

Secured Loans and Credit Cards

5. Some banks offer secured loans and credit cards to people that have filed for bankruptcy. Not all banks offer this, so you need to ask them before you try to apply for their program.

Higher Rates For Poor Credit

6. Once you are approved for credit, get ready to pay a higher rate of interest for their program. If you make all of your payments on time for 6 months, you can request a lower rate from your bank or financial institution. If they were not willing to reduce your rates, I would try applying with some other financial institution.

Open At Lease Two Unsecured Line Of Credit Accounts

7. Once you have been approved for credit and have paid on time for 6 months, try to open at lease one more unsecured credit account. An unsecured credit account really helps to rebuild your credit quickly.

Only Accept Terms That You'll Able To Afford

8. The last point to address is that you should only take on a line of credit that you will be able to afford. Most people go out and get an automobile payment that they know appears a little high. It will be very hard to get approved for any more credit accounts, if you’re late on any of your car payments. Get an idea of what would be an affordable car payment before you go to the car dealer. If you choose an automobile that is above the amount that you have in mind, you are only asking for trouble down the road.

In terms of personal loans after bankruptcy, there are a number of methods that you can use to get the credit you need to get approved for a personal, business, home or auto loan.

Personal Loans After Bankruptcy