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Debt is one of the biggest issues threatening people these days. Debts are formed when people spend more than what they are actually earning. That is why, the most common type of debts are unsecured debts, which are also known as credit card debts. When you are dealing with multiple debts, getting more debts will become difficult as well because of your credit score. When your debts get out of hand and you are struggling with debt repayments, your credit score is affected by the non-repayment of your debts and when this happens, you cannot get more loans or if you do, they will be at a very high interest rate. Moreover, declaring bankruptcy also damages your credit score as well, which automatically makes you ineligible for getting more debts.
This is because; when you declare bankruptcy, your information is entered into the insolvency register or bankruptcy register. The information mentioned in the bankruptcy register can be accessed by all credit monitoring agencies, which is why you cannot get more debts. The insolvency register will contain all of your personal information, as well as the type of bankruptcy you declared to get rid of your debts. Information such as name, date of birth, your home and office addresses, and type of bankruptcy is entered in this register. Other information may be asked from you in order to be mentioned in the bankruptcy register, depending on your bankruptcy because information in this register is different for individuals and companies who have declared bankruptcy.
Your information will remain in the bankruptcy register for a period of three months after your bankruptcy is finalized. After this, your information will be removed from the bankruptcy register. Although, some people might think that allowing everyone to access the bankruptcy register might be a breach of privacy. However, the main reason behind doing so is that, so people who have recently declared bankruptcy, do not try to beat the system and get more loans. This type of activities is known as committing fraud, with severe consequences. Moreover, some employers might also want to keep a check on their employee’s financial situation, so they can also access the bankruptcy register with the help of internet and see if any of their employees have declared bankruptcy in the near past. The main purpose of the bankruptcy register is to avoid any fraud cases, where people might try to conceal their personal information and try to borrow more money from the banks or moneylenders. However, there are legal ways with the help of which people who have recently declared bankruptcy can borrow more money. Loans such as payday loans are best suited for people with bad credit history and those who have declared bankruptcy as well. Getting payday loans is easy because any online or real time lender will lend you a payday loan after checking that you meet their basic requirements. However, if you do not meet the basic requirements for this loan, then you cannot borrow money in the form of a payday loan.
Author Bio: Stuart Mclash is an expert financial writer and avid financial blogger having experience in the field of debt relief. He has written posts on debt management plan, bankruptcy register, IVA, Debt relief orders and on other financial topics as well.