After bankruptcy your discharged debts are gone, you are free of credit card bills, medical bills, and other overwhelming debts. We want you to enjoy your financial fresh start. While we do not advise that you begin to incur debt again right out of bankruptcy, we do recognize the importance of rebuilding your credit score after bankruptcy.
Your credit score is the measure of your creditworthiness used by lenders. The higher your credit score, the more likely you are to get the most favorable loan terms and lowest interest rates. Even if it isn’t immediately after bankruptcy, there will come a time when you will want a new car loan, a mortgage, or a credit card with an exceptional rewards program and low-interest rate.
Tips for Rebuilding Your Credit Score After Bankruptcy
- After bankruptcy make it a priority to pay all of your current bills on time, like rent, car payments, and utilities. Set up automatic bill payments to make it easier.
- Get a line of credit:
- Secured Credit Card: You will give the lending bank a set amount of money to “secure” the card. That amount will serve as the charging limit on the card. Secured credit cards are easier to obtain since the lender is not taking a risk of non-payment.
- Unsecured Credit Card: These are the most common type of credit cards. Many people are able to qualify for certain unsecured credit cards right out of bankruptcy; though, these may come with unfavorable terms like high-interest rates and annual fees.
- Be selective about which credit card you apply for because being denied credit and/or applying for too many cards can harm your credit score.
- Only charge what you can afford and pay your bill in full, on-time each and every month. This will help your credit score increase because it demonstrates your ability to pay back your debts.
- If you have to carry a balance forward, keep your debt load under 30% of your credit line. Carrying high balances in relation to your credit limit harms your score.
- Monitor your credit report after bankruptcy.
- Ensure all accounts are properly reporting a zero balance and “discharged in bankruptcy.”
- You have the right to dispute inaccurate information. Read our article Order A Free Credit Report to learn more.
Following the above tips will help you rebuild your credit score after bankruptcy.
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Find out more about Bankruptcy in our guide: All About Bankruptcy
All of us at the Law Office of Barbara B. Braziel are here to help you end your financial struggle and gain financial freedom. We help people get out of debt by filing for bankruptcy protection. Contact us at (912) 351-9000 today to set up a free consultation.
We proudly serve the people of Savannah, GA and the surrounding areas, including Richmond Hill, Hinesville, Pooler, Port Wentworth, Tybee Island, Clyo, Ellabel, Midway, Ludowici, Springfield, Pembroke, Brooklet, and Garden City.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code.
