Can you get a personal loan after declaring bankruptcy?
Bankruptcy is a relief in some financial situations and allows you to get back on track. Yet, most people are reluctant to declare bankruptcy in fear of permanently tainting their credit report and being unable to take out a loan afterwards.
Find out if this fear is well-founded and if you can obtain credit after going bankrupt.
How bankruptcy affects your credit report
Your credit report will be tainted for 6 years after bankruptcy discharge, during which time it will be more difficult to obtain some types of loans like mortgages from traditional financial institutions. Getting a credit card might also be impossible.
Similarly, while you’re rebuilding your credit, lenders may ask for an endorser, increase your interest rates or even require a security deposit to protect themselves in case of payment default.
Asking for a loan after bankruptcy: yes, it is possible
Despite the unavailability of various credit options for some time after your bankruptcy discharge, you will still have access to private loans such as car loans and personal loans. In these cases, the private lender will determine the eligibility criteria and the repayment and renewal conditions, as well as dictate the rules of the contract in compliance with Canadian and Quebec laws governing this type of loan.
If you declared bankruptcy and need to get your hands on some money, turn to a private lender who is willing trust you and take a risk while your credit report is being rebuilt.
No credit check loans: an option for getting credit after bankruptcy
If you’d like to get a loan after claiming bankruptcy, your best option is a no credit check loan.
As stated in the name, this microcredit solution does not require credit or borrower profile checks. This is an advantage since these can sometimes have a negative impact on credit being rebuilt and the complex process of a loan requiring supporting documentation will be avoided.
Applying for a no credit check personal loan will therefore allow you to get your hands on a small amount of money (loans rarely exceed $1000) in minimal time without affecting your credit score.
DMO Credit offers loans at a low rate, even after a bankruptcy
In conclusion, despite many of your credit options being taken away after declaring bankruptcy, asking a private lender for a loan will still be an option.