Difficulties that the consumers may encounter after bankruptcy and how to solve them

Before the “fresh start” can even begin, life after bankruptcy leaves the consumer little room for leniency. The consumer, after all those mandatory counseling, should now be ready to face the many restrictions and constraints as a result of being bankrupt.


1. When the income falls short of the expenses. This situation forces the consumer to borrow from people again or charge on his/her credit card. Charging on the credit card is a bad idea; the consumer might want to consider living on a cash only basis.

2. Poor budgeting. Failure to keep within a list is the most dangerous mistake a consumer can make just after surviving bankruptcy. The temptation to overspend just because the previous debts have been wiped out is great. The consumer must really take into consideration that his/her life has now changed and the old beaten path is not to be taken again. At least not in 5 years or so.


3. Falling into the old bad habits. A lot, if not most, of the bankruptcy cases were the result of major life crises like serious medical problems, separation or divorce, unemployment, and/or death in the family. What aggravate the already emotional situation is the fact that the consumer has to live on credit cards, borrowing to pay for another debt, or trying out payday loan stores or out of desperation, also taking on other high-interest, high-fee sources, knowing how dangerous it would be if those were not paid on time.

4. Borrowing from the wrong Credit Card Companies. Against a normal debtor (without “bankruptcy” in his/her record), the consumer, after surviving bankruptcy, would undoubtedly pay higher interest rates. The creditors view consumers that have gone through a bankruptcy as “high risk” so the consumer should accept the fact that he/she does not have much of a choice but to accept the higher rates that the creditors offer. Anyway the consumer only needs one card to start re-establishing his/her new credit. However, the consumer should keep in mind that there is a difference between just paying higher rates, and also being slapped with additional handling fees, outrageous penalty fees, and other hidden charges ( just for the privilege of having a new credit account). There are plenty of creditors to choose from and as mentioned earlier, some of them, upon learning about the consumer’s bankruptcy discharge, start to offer a new credit card.

How can the consumer manage the new credit card?

1. The consumer should only accept one credit card.
2. That one credit card’s limit should not be more than $1,000.00.
3. Make sure that the payment is timely and the debt under control.
4. If it is possible to not have a credit card, the consumer should opt for it, but if it is absolutely necessary to charge, make one charge, and until it is paid, do not charge again.