Should Bankruptcy Stop You from Getting a Personal Loan?
Bankruptcy is not the end of the road in getting a loan. Itís neither a financial slaughter house. The old golden days when one would lose hope and feel miserable after filling a bankruptcy case are gone
The new days where one can easily get to rebuild his /her finances, credit, and life have come, although this has always appeared to be the most difficult thing to achieve especially when one has been declared bankrupt or after a bankruptcy discharge.
One can still get a personal loan after being declared bankrupt. The only thing that may be different unlike when you have not filed a bankruptcy case or been discharged is that the loans may be administered at a higher rate than the normal personal loans. Again, you may be more limited in your choice as the lenders from who to choose from may also be limited. Not all lenders will accept to give personal loans to persons with bad credit. You may also be needed to attach security such as an asset or provide a loan guarantor depending on the lender. The banks may also need to look into the situations that lead to bankruptcy and also your current situation before providing the personal loans. So if a person with a bankruptcy case has failed to acquire a personal loan, you should not lose hope because decisions are made on an individual basis.
It would be wise to know and understand the kind of personal loans available before starting your search. There are two categories of personal loans usually available, the secured personal loans and unsecured personal loans. For persons with bad credit, for the secured loans you will be required to deposit some amount of cash or surrender a particular property to the lender as a security for the loan you are borrowing. The best thing about this kind of loans especially to a person with bad credit,on is that it does not require a credit score or financial history. If you default on the loan payment the lender can always retain the collateral. Unsecured personal loans on the other hand, are loans that are not attached to any form of security. The lender uses other forms of collection including a borrowerís income. Therefore even a person with bad credit can still finance the loan if employed and entitled to a wage or income. Both personal loans are easier to get even with bad credits because the collateral will always compensate if there be a default on payment.
On the personal loans one needs to know that the type of personal loan you choose (be it secured personal loan or unsecured personal loan) depends on the amount of money that one needs to borrow, the amount of time that one may need to repay the loan, the availability of an exempt asset or property to be used as a security, how far a personís credit has improved since the declaration of bankruptcy and if employed or not. There are many options for bad credit personal loans including; banks, credit unions among others.
AUTHOR: Richard Ravosa
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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.