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Getting back on your feet after filing for bankruptcy is getting much easier, thanks to the many lenders offering bankruptcy loans. Now you can enjoy opportunities you may not have otherwise. More and more lenders are giving people who have filed for bankruptcy a second chance to own cars, and even mortgage houses.
How soon you will be able to apply for a loan depends on what kind of bankruptcy you filed. You must wait at least two years (24 months) before applying for a loan of you used Chapter 7 bankruptcy. This way, you will already have a fresh 2-year track record of paying bills, savings, and other indicators of financial responsibility for lenders and banks to review.
If you filed for bankruptcy under Chapter 13, you must have already paid all your creditors before you can qualify for a large bankruptcy loan. You may be able to take out smaller amounts of bankruptcy loan even before you pay your creditors fully, though, because lenders are usually more lenient to Chapter 13 cases.
Things to consider
Bankruptcy loans may certainly help you get back on your feet, but think twice before you plunge into yet another loan. You may be digging yourself even deeper by immediately getting a loan after you file bankruptcy.
1. Beware of opportunists.
There are loan companies that will approve credit even when you haven’t completed the required two-year ‘probation’ under Chapter 7 bankruptcy, or even before you have paid off your creditors under a Chapter 13 bankruptcy. Don’t be lured into this because adding more debt too soon usually breeds further disaster.
For instance, interest rates for such ‘instant’ bankruptcy loans are outrageously high, and lending companies that offer them usually require you to put up a collateral, like a property (your house). In the event that you are unable to make payments, these lending companies can foreclose your property, and you will be in even deeper debt. Remember: there are no bankruptcy protections for new debts incurred either during a bankruptcy or for a period of time after discharge. It is therefore best to wait until you’re more stable before applying for a bankruptcy loan. The old adage holds true: you can’t borrow your way out of debt.
2. Consider credit counseling.
You need professional finance advisers to help you make sense of the next steps to take as you get out of bankruptcy. Talk to a bankruptcy loan financing specialist who can assist you in finding the best possible non-abusive, flexible and pro-debtor bankruptcy loan with competitive rates and terms. Good credit counselors can greatly help you by negotiating terms with bankruptcy loan creditors.
Ask for advice regarding debt consolidation. You can actually use bankruptcy loans to merge your debts and pay off high-interest bills, allowing you to have one lower monthly bill. You should also seek advice on how you can improve your credit score. You will need a score of at least 620 to be able to easily apply for loans with better interest rates. | 
