How to Rebuild Your Credit After Bankruptcy
Many people worry that bankruptcy will severely damage their credit, making it difficult to obtain loans or credit cards. But for most bankruptcy filers, this is fear is unfounded.
In most cases, the elimination of the debt following a bankruptcy will, by itself, have the effect of increasing the credit score. In addition, the debtor can further increase their score by following some simple steps.
Here are some steps that can be taken to increase the credit score after bankruptcy:
- obtain a secured credit card
- keep the balance low
- be sure to make all payments on time
- periodically check your credit report to make sure the account activity is being properly reported to the credit bureaus
- also check your credit report to make sure that the debt eliminated or paid in the bankruptcy is not being reported as defaulted debt
- challenge any inaccuracies on your credit report
- avoid opening multiple accounts in a short period of time
Many individuals following these, or similar steps, will realize a credit score increase of 40 points or more within 12-months from the conclusion of their bankruptcy case.