If you need considerable debt relief, filing for bankruptcy can eliminate or minimize balances to help you repair your finances. However, it will negatively affect your credit report for up to 10 years. As a result, it is challenging to get a lender to approve a personal loan application after you’ve filed. If you want to improve your chances of getting a loan after bankruptcy, consider the tips below.

A Guide to Personal Loans After Bankruptcy

1. Check Your Credit Report

The stronger your credit score is, the more likely you’ll get a loan. That’s why you should carefully review your credit report before applying for any personal loans. While you can’t clear the bankruptcy from your credit history immediately, you can improve your score by correcting other errors. For example, there may be discharged debts or repayments that aren’t on the report.

2. Compare Rates

When you apply for personal loans, don’t go with the first provider that will give you funds. Instead, consider multiple lenders and compare their respective rates. The lower you can get the interest rate, the less debt you’ll accrue from the loan.

3. Start Small

If a personal loan application gets denied, you can try to apply for a smaller principal amount. While the balance may seem low, you are more likely to get approval. It might also be easier to make payments on these initial loans, which will improve your credit score and enhance your financing opportunities in the future.

4. Make Regular Payments

You should adhere to any repayment requirements for financing you take out after filing for bankruptcy—including personal loans. When you make payments on time, your credit score will improve and expand your lending options.

5. Appeal for Better Terms

If you are denied a personal loan or get an offer with an excessively high-interest rate, consider appealing to the lender. While not guaranteed, providers will offer approval or lower rates on a case-by-case basis to those who demonstrate financial responsibility. Getting a cosigner can also help lower the risk you present,  improving your chances of getting approved or a lower rate.

Filing for bankruptcy carries long-term financial effects. But when you plan with Harry B. Zornow—an experienced bankruptcy attorney in Hamilton, OH—you can navigate the process productively. He is well-versed in Chapter 7 and Chapter 13 bankruptcy and will guide you through the process to help you get the best results. For more information about his services, visit him online, or call (513) 737-9770.