How does Chapter 13 Bankruptcy affect my ability to acquire new credit?

Chapter 13 Bankruptcy Law in California can significantly affect your ability to acquire new credit. When you go through bankruptcy, you must submit a repayment plan to the court outlining how you will pay your creditors. This plan can last anywhere from three to five years and the debtors must strictly adhere to the court-ordered payments. During this time, credit can be hard to come by, as lenders are often wary of loaning to debtors in bankruptcy. Though bankruptcy can make credit harder to acquire, it is not entirely impossible. You may still be able to secure new credit while in bankruptcy as long as you demonstrate good financial habits, such as regularly making payments on time. Additionally, some lenders may take into account your current financial situation and still grant you credit. It’s important to note that the court can also grant you permission to acquire new credit during the bankruptcy period. However, if you do choose to acquire new credit, you must ensure that it will not negatively affect your repayment plan. Finally, once you have completed your repayment plan, you may find that it is easier to acquire new credit. According to the Federal Trade Commission, your credit score will gradually improve over time as long as you use your reinstated credit responsibly.

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How does Chapter 13 Bankruptcy affect my ability to acquire new credit?

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