How to Rebuild Your Credit Score After Bankruptcy
These days our financial future revolves around the three little numbers that make up our credit score. A good credit score means we are home and dry when it comes to applying for a loan or any form of financing. A bad credit score can give us major headaches and stumbling blocks.
God forbid you ever become bankrupt because you just don’t want to see the damage that will do to your credit score. The recovery is a long and very stressful process. More often than not you are virtually left with nothing but the shirt on your back.
But life does go on even after such a major financial set-back like bankruptcy. Things will be difficult for a while but if you are determined to get out of the mess well things will improve. The first thing you need to tackle is getting a better credit score.
It can take up to 10 years for any signs of improving your credit score when you have been bankrupt. If you take complete control of your finances you will see major changes within as little as three years. You need to improve your credit rating by improving credit scores as quickly as possible.
One of the first things you must do is apply for a credit card from a major lender. It’s not as difficult as many people think. You’ll only get a small credit limit – but it is a beginning. You’ll be surprised by the amount of companies that will still lend to people with a bankruptcy record.
Having been bankrupt now put you in the enviable position of having no other debts. The lenders know this and they also know you cannot file for bankruptcy within the next seven years. So, they know they will get their money back one way or another.
The next big step is to find a regular job. Normally you need to be in employment for one year. Short term employment is not looked on too kindly by the majority of lenders. So the longer you are employed the better it is for you. Bringing home a regular pay check helps immensely.
When you eventually receive your credit card make sure you keep to a regular payment schedule. Don’t go overboard with your spending on the card. Keep a reasonable amount of space between your balance and your credit limit. This is an integral factor in raising your credit score.
I’m not saying it will be easier but it is possible to improve your credit score quickly after bankruptcy. You must stay on top of your bills, keep in regular employment and meet all your commitments on time. Taking it one step at a time you will improve your credit rating.
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Filed under: Improve Your Credit Score
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A credit score has a massive reach nowadays and people often forget about its implications in background checks and its use in figuring insurance premiums.