Bankruptcy is neither the nightmare you imagines it to be nor the trump card you hold on your creditors. It is best viewed as a step or stage towards am outcome that is fair for all parties. But because of the society cannot be run in a way where everyone can get away from their debts just by bankrupting themselves, there must be a price to be paid for those who decide to or are forced to go this route.
You really have no justification to say that the system is unfair to you. You have after all, took on money belonging to others and will either pay nothing for them or a very small fraction of the actual amount. If you want to make a complaint about fairness, take a queue number behind your creditors. Even though the legal system offers you a way out of the financial misery, you will still incur the hidden costs of filing for bankruptcy for many year to come.
You credit score will take a beating
It will be very straight forward. As soon as a lender sees the bankruptcy in your credit, it will decline your application for whatever you are applying for immediately. Despite all the scam advertisements you see in online classifieds, there is no way anyone can do anything about it. Not even an “insider” at the bank as advertised in suspicious classifieds listings.
And when it is over, you will still be subject to higher interest rates and possibly more stringent assessment criteria. This can mean lower loans, higher interest and higher payments. That is the price you have to pay. Well, you can still use your spouse’s name to borrow. It’s a taboo topic. But the fact is that many people do it this way to navigate a way around the system.
Lenders might avoid doing business with you
Even if a lender is not aware that you are a discharged bankruptcy from their checks, you are required to declare it when applying for any form of credit facilities. It might come in the application form when you are asked a question of whether you have been a bankrupt before. If you lie, you could get into deeper trouble. So even if you have a healthy credit score years after your discharge, your history can still affect your loan applications. If it does not, lenders will not be asking that question in the first place.
Renting apartments
Landlords, especially experienced ones know that one of the most important factors for the success of their operations is to rent to good tenants. And an important criteria to being labeled as a good tenants is one who is able to easily and promptly make rental payments on a timely basis. So it is not a surprise to find landlords checking credit reports of prospective tenants to learn about their financial history and current situation. You might not be able to ever verify this. But experienced landlords would probably not rent to those with a history of bankruptcy. They are protecting their investment after all.
Job applications
If you are applying for jobs that are related to finances, a bankruptcy record will raise the eyebrows of the recruitment manager. Even for jobs that are non-finance related, employers might prefer to go the safe route rather than take a risk with you. Again, you cannot really blame anyone for your predicament. You have brought this onto yourself.
Your reputation points plummet
You will be subject to gossip among your social circle and acquaintances. People are going to form an impression of you are a loose cannon and unreliable when it comes to financial matters. They might even attempt to avoid you as they are afraid that you will put them on the spot by begging for money. Opportunities you mention will be perceived as a scam you are running to cheat people out of their hard earned cash.
The truth is that you might have to live with this stereotype and even be ridiculed for the rest of your life. Your financial past will be a fact and there is nowhere you can hide from it. The best way to approach this is not to feel shameful about it. Acknowledge it as a mistake while not trying to hide it. People will respect you more this way than if you are to feel ashamed about your past.