When you file bankruptcy, you learn how it will impact your credit. While this filing can be damaging for a while, it’s not impossible to restore your credit and begin building credit again.
Once your bankruptcy filing is finalized, it’s time to start taking steps to rebuild your credit. Tips that can help you do this are found here.
1. Check your credit
You need to know where you stand after a bankruptcy filing. You can find this on your credit report. Take time to get to know the various elements of the credit report and look for errors or mistakes to dispute. You can also see how the bankruptcy filing impacted your credit score at this point.
2. Start using credit again responsibly
If you want to start rebuilding your credit score, you need to be responsible with your credit. Some tips to keep in mind include:
- Make payments consistently and on time
- Don’t file a lot of credit applications at once
- Keep your credit balances low. Do not carry a balance over 30 percent of what is available.
- Create an emergency savings fund
3. Apply for a secured credit card
It’s smart to reduce how much you depend on credit cards, but if you have no credit cards you probably won’t have a very good score. Obtaining a secured card can help you rebuild your trustworthiness to lenders if you are having trouble getting a regular credit card.
You must make a security deposit to a secured card, and then you can borrow against it. While these come with high-interest rates, they also report to all three credit agencies, which makes them a great option to show how responsible you are.
Rebuilding your credit after bankruptcy
Filing bankruptcy is a big decision. Before moving forward with this, be sure you know all your legal rights and options. Once you have filed, there are steps you can take to rebuild your credit that you should use.