For most folks, credit improves after bankruptcy for a very practical reason—you no longer have debts and future creditors can consider your ability to repay (job security, stability of income, security, etc.), rather than worrying about whether you can pay the new debt because of past bills.
Car loans and secured credit cards are fairly easy to get after bankruptcy if you can save up a down payment and have a steady job. House loans are sometimes available two years after a bankruptcy (longer if you have had a foreclosure), or owner financed deals or co-signed mortgages are sometimes available sooner.
Creditors realize that good, reliable people sometimes have to file bankruptcy because life problems have created overwhelming debt and they are willing to give you another chance if you qualify after your case is complete.
While we generally don’t recommend getting into debt after a bankruptcy for obvious reasons, credit can be important for certain things and it is possible to begin rebuilding your credit right away.
Finally, within the bankruptcy is the Debtor’s Education Class requirement which provides people with some valuable tips about rebuilding your financial life and taking advantage of your fresh start in a balanced and healthy way.
Call me, Peter Milwid, today if you have any questions about Chapter 7 Bankruptcy, or your future credit when your case is over.