Choose Your After Bankruptcy Lenders Wisely.
by Brian Douglas
After bankruptcy, forget the big banks. They won’t help you. They’re scared ofyou! They’ve got hard and fast policies that will keep you out of the borrowing arena for at least one year–more likely 2-3 years after your discharge. And it doesn’t matter if you have a Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. It’s that “B Word” that will hurt you!
Run from those guys–they are not your friends. Avoid them like the plague. They may tell you that they’ll work with you after your bankruptcy, but that’s usually not the case. Don’t waste your time.
So now you’re probably wondering what your alternative is. And I’m glad to give you the same advice I’ve been giving to small business owners for decades–Visit your local community bank or credit union!
Yes, your small community banks and credit unions can be your friend, and may be more than willing to help you re-establish credit after bankruptcy.
There are plenty of small community banks out there, but choose them wisely. You’ll want to select an established bank–that’s one that’s about 5 years old or older. Why? Well, these days, new institutions are under close scrutiny from their banking regulators (Federal and State). While they’re under such scrutiny, they’re much less likely to “take a chance” on you.
Established banks have more independence, and that’s key to your borrowing strategy after bankruptcy.
You’ll want to talk to the president of the bank–yes, the president. You want to interview the bank and let them sell you on what they can offer.
Your job is to build a relationship for yourself, your family, and your business. Yes, I said “your business”. It’s that business relationship that may grease the wheels for you when you talk to the bank about a loan in the future–they want to grow, and most prefer to grow with businesses.
Don’t have a business yet–don’t worry–we’ll be covering THAT, too in future articles and videos! For know, just focus on the small community banks or credit unions. You can open an account there and begin to build relationships. I would definitely suggest calling (anonymously at first) to ask their policy on bankruptcy–then go to the one that seems most flexible. Then we’ll build our relationship–and our new credit!
One more thing–When you interview the banker, DO NOT ask for a loan at that time! Your sole objective is to build rapport. You will need to build that relationship and “earn the right” to get credit from that bank, but it’s that personal relationship that may very well tip the scales in your favor.
Keep in mind that the local community bank understands the local economy. They’ve seen many of their best customers file bankruptcy, and they’re still doing business with them. If you’re candid with your new banker, you may be very surprised at their willingness to work with you.
Don’t ever let your Chapter 7 Bankruptcy or Chapter 13 Bankruptcy stop you from rebuilding your credit and rebuilding your life. You’re on the right track to a fresh start, and this is just one of the many strategies I recommend to get you there faster!
You can learn more in my Bankruptcy Survival Guide. Check it out on my website. And feel free to share this article with your friends.
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