How Bankruptcy Affects Getting a Loan

by tammy on February 11, 2010

If you are like a lot of people you may have had to file bankruptcy at some point or other. This is not uncommon and you really should not feel too badly about it because there are situations in life that will come up  that just can’t be helped. For instance, the recession has affected the lives of many, many people and it has caused a lot of people to file for bankruptcy that wouldn’t have done so at another time perhaps.

When it comes to getting a loan, you can rest assured that filing for bankruptcy is very likely to impact your loan and the amount you are able to get or if you can get a loan at all. This is something you will really need to think about as you try to get a loan. There are a lot of people who may not have a clue that bankruptcy can strongly impact being able to get a loan, but it can.

One of the reasons it can be so difficult to get a loan if you have filed for bankruptcy is the fact that you will present a risk to the financial institution you are applying with to get the loan. It’s a great idea to take the time and speak or your bank to see if you will indeed qualify for the loan or not.

However, you will need to bear in mind that if you have filed for bankruptcy in the past, then it is very likely even if you do get the loan, that your interest rate will go very high. This is one of the negative impacts of filing for bankruptcy and you will want to rest assured that if you do try to get a loan, you will want to get an idea of how much your interest rates can be.

It is never a good idea to file for bankruptcy if there is any way around it because it will impact your ability to get a loan at a decent rate. There are a lot of people that will tell you otherwise, but you can count on a bankruptcy having a very negative impact on your credit score. When it comes to getting a loan be certain you take the time to get all the details upfront, this will be a great idea for anyone.

So, if you think that a bankruptcy will not have a strong impact on your credit score you could be very wrong. A bankruptcy will also lower you credit score significantly and this is not a good thing for anyone.

So, it will certainly be in your best interest to try and maintain a high credit score to get the best interest rate you can. You should be forewarned that regardless if you can help a bankruptcy or not, it will have a very negative impact on your credit rating.

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