What if I Get Rich after My Bankruptcy?
If you’re considering filing personal bankruptcy as a way of easing your debt burden, you may be wondering to what extent bankruptcy protection can stop creditors. Many people envision a true fresh start with financial success after bankruptcy, and find themselves asking the question, "What if I get rich after my bankruptcy?"
The good news is that bankruptcy laws are designed to free you from burdensome debt and give you a fresh shot and prosperity. And in many cases, once your bankruptcy is discharged, creditors are permanently preventing from collection efforts.
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Life & Wealth after Bankruptcy
So what can you expect if you get rich after your bankruptcy? The answer depends on a number of factors.
- Wealth after a Chapter 7 bankruptcy: Chapter 7 bankruptcy cases tend to move fairly quickly; filers can expect a discharge from the court within a relatively quick time, usually four to six months. When you get a Chapter 7 debt discharge, you are legally excused from paying any debts included in the discharge. That discharge cannot be "undone" if you accumulate wealth in the months and years following bankruptcy.
- Wealth after a Chapter 13 bankruptcy: Determining what happens to post-bankruptcy wealth in Chapter 13 bankruptcy may depend in part on what you mean by "after" bankruptcy. Chapter 13 works by allowing filers to catch up on past-due debts with the help of a three- to five-year repayment plan. If you manage to get rich during the course of your repayment plan, you should consult with your bankruptcy lawyer to determine whether additional income will affect the terms of your repayment plan.
Does My Discharge Still Count if I Get Rich after Bankruptcy?
The important thing to understand is that, once the court discharges a debt, you are no longer responsible for paying that debt, regardless of your future financial circumstances. And, if you're like many bankruptcy filers, turning to bankruptcy may serve as a wakeup call to you to change the way you handle your finances.
- Financial management course: In order to be eligible for your discharge from the bankruptcy court, you must complete a financial management course, which is designed to help prepare bankruptcy filers for life after bankruptcy. In theory, the financial skills included in this course could help you lay the groundwork for stronger post-bankruptcy finances.
- Credit after bankruptcy: One important task for people recovering from a bankruptcy filing is rebuilding their credit. While some bankruptcy filers may be tempted to swear off credit altogether, many financial gurus advise establishing at least some credit accounts in order to build a strong credit profile, which may help build financial wealth down the road by allowing you to qualify for loans with lower interest rates.
Ask a Lawyer Your Legal Questions about Life after Bankruptcy
If you still have questions about what might happen to your finances and debt obligations if you get rich after your bankruptcy, you can take advantage of this offer for a free bankruptcy consultation with a bankruptcy lawyer in your area.