Search
Google
Web This Site
Recommended Sites
Related Links
   

Informative Articles

Don't Be Stopped by Bad Credit
If you are interested in buying a new home or refinancing the one you are currently living in, but think that you are out of luck because you have bad credit, think again. The mortgage industry is probably larger and more diverse than you...
How To Accept Credit Cards Without A Merchant Account
To increase sales on your website, you must accept credit cards. To process credit cards, you could apply for a merchant account through your bank or other financial institution. Sometimes, though, you would be further ahead to use...
Prepaid Credit Cards Online
There are some websites you would like to purchase merchandise but you don't trust the website yet with your credit card information. A solution is in place, Get a Prepaid Credit Card! These plastic wonders help you protect your real credit card...
Save Money By Understanding Your Credit Card
Around £6billion a year is lost due to credit card users not understanding how their credit card works. Too many people are dazzled by the latest deals offered by credit card companies and end up paying more than they should, simply ...
Start Accepting Credit Cards
Are you an accept credit card today kind of business? If not, this may be the time for you to check into opening a merchant services account. By learning how to accept credit card payments at your place of business or on a company Website, you can...
 
Credit After Bankruptcy

One of the most common questions debtors ask bankruptcy lawyers is "Will I be able to get credit after filing bankruptcy?".
Most people are suprised to find their mailboxes flooded with new credit offers after filing bankruptcy. Why does this happen? Why would a creditor give more credit to someone who has filed bankruptcy?
Creditors make money by lending money. If creditors don't lend money, they don't make money. Even credit cards for people with the best credit ratings often carry credit card balances that will not be paid off within the next 20 years if the debtor pays the minimum monthly credit card payment.
Creditors lend money based upon a debtor's debt to income ratio. Debt to income ratio is the amount of debt a debtor has versus the amount of money the debtor earns. If a debtor has monthly debt that exceeds the debtor's monthly income, the debtor is obviously a poor credit risk and it is unlikely that a creditor will risk loaning money to the debtor.
What happens to a debtor's debt to income ratio when the debtor files bankruptcy? The bankruptcy will wipe out the debtor's debt and leave the debtor with the same income. Filing bankruptcy transforms the debtor's debt to income ratio and creates a positive lending prospect for the creditor.
Creditors also know that the debtor who has filed a chapter 7 bankruptcy will not be able to file another chapter 7 bankruptcy for 8 more years under the new bankruptcy law. Creditors know that the debtor who has filed bankruptcy is stuck with whatever new credit is issued and will not be able to discharge the debt as easily in a second bankruptcy.
Filing bankruptcy can actually improve the credit outlook for many debtors. Most bankruptcy lawyers offer free consultations to discuss bankruptcy and credit issues.
About the Author
BankruptcyHelpOnline.org is the bankruptcy resource solution that makes bankruptcy easy to understand. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 has made filing bankruptcy more complicated than ever before. BankruptcyHelpOnline.org is your source for useful bankruptcy information that is easy to understand.