Personal Loans After Bankruptcy

Personal loans after bankruptcy may be easier to get than before the bankruptcy due to the fact that the borrower is no longer obligated to pay debts, and therefore they will have a larger monthly cash flow. While it is not recommended that as soon as a debtor finishes his bankruptcy proceedings they immediately get in debt again, there may be a need to get funds that only a personal loan after bankruptcy can fill. This form of financial assistance will definitely carry a higher interest rate, as the borrower's credit score has just been lowered due to the write off of all outstanding debts. The individuals credit score will be low for up to 10 years, making it necessary to begin the credit rebuilding process with assistance from a financial company in the form of a loan.

The amount of financial assistance received after becoming bankrupt does not have to be large, just enough for the borrower to afford repayment and begin the rebuilding process. After a year of consistent payments, the individual will notice their credit score begin to rise. Personal loans after bankruptcy can really help a borrower get back on their feet and become an active member of their financial society again. A personal loan after bankruptcy can give a borrower a sense that they have paid dearly for their irresponsibility and the hope that another chance will make it right again, and prove their financial worth.

Individuals seeking good interest rates on the various forms of financial assistance may not be happy with what they find. Lenders are reluctant to offer a lower interest rate on a personal loan after bankruptcy because the risk is too high for default. When the lender's risk increases, so do the personal loans after bankruptcy interest rates. The best option a borrower has to receive a good rate is to provide some sort of collateral to be pledged as security on the loan. Collateral can come in the form of home equity, a car, boat, retirement plan, etc. If securing collateral is impossible, perhaps the option of getting a co-signer exists.

Personal loans after bankruptcy were designed to give the borrower another chance. Perhaps there is a friend or family member that is willing to give the borrower that same chance. These are still obligations that must be repaid. The Bible says in Ecclesiastes 5:4-5 "When thou vowest a vow unto God, defer not to pay it; for He hath no pleasure in fools: pay that which thou has vowed". When a Christian gives their word to repay a loan, they not only give it to the lender, but to God.

Source: http://www.christianet.com/personalloans