Bankruptcy is a tough decision, but sometimes it’s the best decision. If you have a lot of debt that you unable to pay, then bankruptcy may be your best option. Bankruptcy typically stays on your credit for seven to 10 years. However, the good news is that you can start rebuilding your credit shortly after you file for bankruptcy. Below are some tips that will help you rebuild your credit after bankruptcy.
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Errors on your credit report can cause your credit score to go down. That is why you may want to take a look at your credit report. Make sure that you report any and all inaccuracies to the credit bureaus.
Payment history is one of the biggest factors determining your credit score. Therefore, paying your bills on time is one of the best things that you can do to improve your credit score. Having one missed payment on your credit report can cause your score to decrease.
Secured credit cards require that you make a down payment on the card before you use it. You can get a secured credit card even if you have bad credit, so you may want to apply for one. If you make payments on time, then you may be able to increase your credit score shortly after filing for bankruptcy.
If you have a credit card, then you should try your best to pay it off in full each month. Paying the balance off in full each month will reflect positively on your credit report.
You may be eligible for a loan within a year or two after filing for bankruptcy. If you apply for a loan and get approved, pay the loan back on time. This will allow you to improve your credit score.
If you have an account that you are not using, then you still may want to keep it open. Closing a credit account can lower your credit score.
You will need to check your credit regularly. This will ensure that there is no inaccurate information reported.
Even though taking out a credit card and paying the bills on time can boost your score, you do not want to apply for several lines of credit in a short amount of time. This will reduce your score.
There are many companies that claim that they can get the bankruptcy removed from your credit report. However, if you indeed filed for bankruptcy, it cannot be removed from your credit report. You will also end up wasting time and money.
Building good credit is something that takes time. Taking small steps, such as paying your bills on time, wisely using a secured credit card and applying for a small loan will help you get your credit back on track.