Personal Loan After Bankruptcy: How To Qualify and Rebuild

Bankruptcy can give you a fresh financial start, but it doesn't permanently prevent you from borrowing. While it remains on your credit report for several years, you may still be able to qualify for a personal loan after bankruptcy.

When you get a personal loan depends partly on the type of bankruptcy you filed and whether it's been discharged.

• Chapter 7 bankruptcy: Discharge occurs after three to four months.

• Chapter 13 bankruptcy: Discharge occurs after three to five years. You may be able to get a loan during your repayment plan, but it will need court approval.

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Approval may be more difficult after bankruptcy, as lenders will consider your past challenges with debt along with other eligibility requirements. If you're rebuilding your finances, here's what to know about your borrowing options and how to improve your chances.  

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Key Takeaways

• Bankruptcy doesn't disqualify you from getting a personal loan. Approval can be tougher since lenders will consider your credit history and overall financial profile.

• The time bankruptcy stays on your credit report varies by type. Chapter 7 can remain for up to 10 years, while Chapter 13 can remain for up to seven years.

• Your loan options depend on your situation. They may include secured loans, co-signed loans or credit builder loans.

• There's no standard waiting period for getting a personal loan after bankruptcy. Individual lenders may have their own requirements, and Chapter 13 borrowers may need court or trustee approval to take on new debt during their repayment plan.

• A few steps may improve your approval odds. Check your credit report, show proof of stable income, start with a smaller loan amount and compare multiple lenders.

Summary generated by AI, verified by MoneyLion editors

Can You Get a Personal Loan After Bankruptcy?

You can get a personal loan after bankruptcy. However, some lenders may require you to wait until after your bankruptcy is discharged. The discharge date for a Chapter 7 is typically three to four months from the filing date. For a Chapter 13, discharge generally occurs three to five years after filing.

Lenders may also consider factors beyond your bankruptcy, including:

• Your credit score since discharge 

• Your employment stability 

• Your income  

• The amount of time that has passed since your bankruptcy 

• Your debt-to-income (DTI) ratio 

• Your ability to get a co-signer or offer collateral 

How Long After Bankruptcy Can You Get a Personal Loan?

Unlike a mortgage, there is no universal waiting period to get a personal loan after you file bankruptcy. Some lenders may be comfortable extending a loan shortly after your bankruptcy is resolved, while other lenders may want you to wait for at least a year.  

• For a Chapter 7 bankruptcy, you can apply for a personal loan after discharge, which may take three to four months after you file.

• For a Chapter 13 bankruptcy, you may have to wait three to five years for either discharge or plan completion.

In certain situations, you can get a loan while repaying your payment plan. You’ll be required to get court approval for your personal loan. 

Chapter 7 vs. Chapter 13: How Does Bankruptcy Type Affect Loan Approval?

Your approval chances can vary depending on whether you filed Chapter 7 or Chapter 13 bankruptcy. Here’s a side-by-side comparison:

Chapter 7

• Chapter 7 erases unsecured debts, such as credit cards and medical debt, without a repayment plan.

• You may still have to liquidate some assets to pay creditors.

• Lenders may be more cautious about extending new credit shortly after a Chapter 7 filing.

• This type of bankruptcy stays on your credit report for up to 10 years, which can affect your credit score and overall creditworthiness during this time.

Chapter 13

• Chapter 13 bankruptcy allows you to keep your assets, but it doesn’t eliminate your debt immediately.

• It typically requires a court-supervised repayment plan lasting three to five years. During this time, you make structured payments to creditors based on your income and debts.

• Since it involves repaying a portion of what you owe, it could demonstrate that you’re taking steps to manage your debt responsibly.

• You may be able to get certain types of credit during the repayment plan with permission from the bankruptcy trustee or court.

• Chapter 13 bankruptcy stays on your credit report for up to seven years.

What Types of Personal Loans Are Available After Bankruptcy?

Depending on the lender’s requirements and how much you want to borrow, there are a few loan types available after bankruptcy.   

• Secured loan: A loan backed by collateral, such as a home or car. If you fail to make payments on your loan, the lender can seize your collateral.  

• Unsecured loan: A type of loan not backed by collateral. You’ll likely pay higher interest rates and have stricter repayment terms.  

• Co-signed loan: A loan with a co-signer, or someone with good credit and income who agrees to repay if the primary borrower does not. Missed payments by you will also impact the co-signer’s credit.  

• Credit builder loan: An installment loan designed to help borrowers build credit. Timely payments can help your credit, but if you miss payments, that will also be reported to the credit bureaus.  

How To Get Financing After Bankruptcy

Here are some steps you may need to take to get financing after bankruptcy.

1. Consider the Type of Loan

Compare loan options based on how much you want to borrow and what you can qualify for. A secured loan or co-signed loan may be worth considering if you're having trouble qualifying on your own, while a credit builder loan may make more sense if rebuilding your credit is a priority.

2. Get the Court’s Permission, If Necessary 

If you filed a Chapter 13 bankruptcy, you may need approval before taking out a new loan. This is because Chapter 13 requires a court-supervised repayment plan, and taking on new debt could affect your ability to make those payments.

3. Wait for Discharge

Some lenders prefer that your bankruptcy be discharged before approving a loan, although the timelines and personal loan requirements can vary by lender. In some cases, borrowers may qualify sooner if they have a stable income and have started rebuilding their credit.

4. Check Your Credit

Review your credit report to understand where you stand and identify areas for improvement. Identify any areas where there are errors and try to address them before you apply for a loan.

5. Show Proof of Stable Income

Lenders want to see proof that you can afford to repay the loan. You may need to provide pay stubs, tax returns or bank statements.

6. Consider Applying With a Co-Signer

If your credit score is too low to qualify, consider using a co-signer. A co-signer is someone who will take responsibility for the loan if you are unable to make payments.

7. Start With a Smaller Loan

A smaller amount may improve your chances of approval because it involves less risk. Repaying a smaller loan can also help you build a positive repayment history and improve your credit score.

8. Compare Lenders

Requirements vary, so comparing options can help you find lenders with more flexible criteria.

Rebuilding Credit After Bankruptcy

If you’re taking out a loan to help rebuild your credit, here are some alternatives.

• Use a secured credit card: A secured credit card requires a refundable security deposit that serves as your credit limit. If you default, the card issuer uses your security deposit to cover the balance on your card.

• Consider a credit builder loan: A credit builder loan can help build credit by establishing a positive payment history. 

• Become an authorized user: An authorized user is someone who has permission from the primary cardholder to use their credit card account. This can help improve credit history.

• Pay bills on time: Timely payments can help you rebuild your credit score after bankruptcy. Payment history makes up 35% of your score. 

• Keep credit balances low: Maintaining low balances on credit accounts can help improve your credit utilization ratio and show responsible use of credit.

What If You Can’t Qualify for a Personal Loan Yet?

If you can’t qualify for a personal loan, there are alternatives you can consider.

• Work on rebuilding your credit: Make your payments on time and check if they are reported to the credit bureaus. Review your credit reports to make sure your payment history is being recorded accurately.

• Ask for a payment plan: If you have a long history with the lender and have continued making payments, ask whether they can offer you a payment plan that works with your budget.  

• Use a credit builder loan: If rebuilding your credit is your main goal, consider whether a credit builder loan makes sense for your situation.  

• Consider a secured loan: If you have a car, savings or other asset that you can use as collateral, a secured loan may be easier to qualify for.

• Talk to a credit counselor: If you’re feeling overwhelmed, a nonprofit credit counselor can help you review and organize your debts. 

How To Avoid Loan Scams After Bankruptcy

Bankruptcy doesn’t prevent you from qualifying for a personal loan. Before you start applying, watch for these potential red flags and protective steps:

• Avoid lenders promising guaranteed approval. 

• Never pay upfront fees before receiving funds. 

• Verify the lender's credentials and contact information. 

• Don't send money via wire transfer or gift cards. 

• Look for clear annual percentage rates (APRs), fees and repayment terms before accepting an offer.

• Walk away from lenders using high-pressure tactics like “act now.”

Good To Know

You can report suspected scams to the Federal Trade Commission (FTC). Keep any emails, texts or payment records related to the offer in case you need them when filing your report.

Personal Loan After Bankruptcy FAQs

Still have questions about getting a personal loan after bankruptcy? Here are answers to some of the most common ones:

How soon after bankruptcy can I get a personal loan?

You may be able to get a personal loan after your bankruptcy is discharged. This typically takes three to four months after filing Chapter 7 bankruptcy, while Chapter 13 lasts three to five years before discharge. Some lenders may also require a waiting period after discharge and may look for signs that you’ve begun to rebuild your credit before approving the loan.

What is the easiest loan to get after bankruptcy?

The easiest loan to get after bankruptcy is typically a secured loan. This is because secured loans are backed by collateral, such as a mortgage on a house, reducing risk for the lender.

How long after bankruptcy can you get a bank loan?

How long after bankruptcy before bank loan approval depends on the lender, the type of loan and the type of bankruptcy you filed. Some borrowers may qualify for certain loans after their bankruptcy is discharged, while others may need to wait longer while rebuilding their credit.

Can I get a personal loan right after Chapter 7 bankruptcy?  

Once your Chapter 7 bankruptcy is discharged, you can apply for a personal loan. Approval will likely be difficult. You’ll face high APRs, restrictive repayment terms and you may need a co-signer. 

Can I get a personal loan during Chapter 13 bankruptcy?  

You may be able to get a personal loan, but you’ll need court approval. Since you’re actively repaying your debts, the court will have to determine if you can take on additional debt.  

Will a personal loan help rebuild credit after bankruptcy? 

A credit builder loan can help with your credit. Make sure that the loan will report to all three credit bureaus.  

Key Terms

• Chapter 7 bankruptcy: Also called liquidation bankruptcy, this filing erases most unsecured debts like credit cards and medical bills, though you may have to sell certain assets to repay creditors.

• Chapter 13 bankruptcy: A filing that lets you keep your assets while repaying debts through a court-supervised plan lasting three to five years, after which remaining eligible debt may be discharged.

• Bankruptcy discharge: A court order that releases you from personal liability for certain debts, meaning you no longer have to pay them back.

• Secured loan: A loan backed by collateral such as a home or car. Because the lender takes on less risk, a secured loan is often easier to qualify for after bankruptcy.

• Credit builder loan: An installment loan designed to help you build or rebuild credit by reporting on-time payments to the credit bureaus.

• Co-signer: Someone with good credit and stable income who agrees to repay your loan if you can't, which can help you qualify when your credit is low.

• DTI ratio: The share of your monthly income that goes toward debt payments, which lenders use to gauge whether you can afford a new loan.

Summary generated by AI, verified by MoneyLion editors

Sources

• United States Bankruptcy Court. 2026. "What is the difference between bankruptcy cases filed under chapters 7, 11, 12 and 13?"

• United States Courts. "Chapter 7 - Bankruptcy Basics."

• American Bankruptcy Institute. "Debt Incurred After Bankruptcy Filing."

• ConsumerAffairs. 2025. "Personal Loan After Bankruptcy: How It Works."

• Federal Trade Commission. "What to Know About Advance-Fee Loans."

• United States Courts. "Discharge in Bankruptcy."

• Fannie Mae. "B3-5.3-07, Significant Derogatory Credit Events — Waiting Periods and Re-establishing Credit (08/07/2019)."

Photo Credit: iStock.com

Josephine Nesbit contributed to the reporting for this article.