Bankruptcy can happen to anyone, and it could even be unavoidable for some. You need to move past the fact that it happened and just find a way to rebuild credit. For many people, this will need a change in economic philosophy and spending habits. Below is a list of ways to rebuild your credit after bankruptcy.
Stick to a budget
The most important part of rebuilding credit after bankruptcy is sticking to a budget. One must pay every bill on time, never make a late payment and no more negative marks on your credit report appear. Learning what the budget allows is important, since your borrowing power has changed even if your income has not. Getting credit just after bankruptcy will cost you more in finance charges and annual percentage fees. Living within ones budget starts with awareness. So, write it all down by making a chart or spreadsheet and whatever is available for a given item, stick with it, don’t budge and don’t get any more negative reports.
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Get a high-rate or secured credit card.
It is possible to get a credit card soon after bankruptcy and using it can put some positive marks on your credit report. One can get a credit card after bankruptcy, usually with a higher rate or by securing–depositing money that backs every penny you charge to the card. Remember to pay off the credit card every month, don’t carry a balance and account for these payments in your budget. The secured card is not like a check or atm card, one must still make the minimum payments. If one can successfully use any of these cards, positive marks appear on your credit report.
Take a small personal loan.
Remember, creditors are looking for positive marks on your credit report. It is critical to build it up once again, despite having bankruptcy on your credit report. Taking out a small loan which you include to your new budget helps a lot. These loans will likely have a higher rate than before because of your bankruptcy, but it can go a long way in positively changing of your credit report after bankruptcy.
There is no one magic move that fixes your credit after bankruptcy. to effect the credit score a clear plan and working month by month restoring trust in ones use of credit is the key. It will take time and effort. If the intent is to use credit in the future, it is worth regaining the trust.