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Bankruptcy can potentially stay on your credit report for up to 10 years — depending on under which chapter you filed. And even though it seems like bankruptcy will have an ongoing impact on your financial circumstances forever, that’s simply not the case.
There are ways to improve your credit history and increase your chances of loan or credit card approval after bankruptcy. Check out steps our suggestions to follow for repairing your credit history, plus a few ways to maintain good credit so you can move past bankruptcy.
Building up healthy financial habits is the best way to repair a bad credit rating that comes from having bankruptcy listed on your credit report. This can be done with the help of a credit repair specialist or on your own using the following steps:
It’s important to realize that this process takes time. The longer you focus on these credit building strategies, the more positive of an impact you’ll see reflected in your credit report — it’s worth it in the long run.
Your payment history accounts for 35% of your credit score, so it’s crucial to make on time payments to rebuild your credit.
How much does credit repair cost?
The most important thing after bankruptcy is taking the right measures to improve your credit history. Only apply for a product when you’re confident you’ll meet the eligibility requirements and can manage the account responsibly. Remember that it could take time before a lender is willing to approve your credit application after bankruptcy, so try to have patience.
Some different types of credit that can help improve your creditworthiness after bankruptcy include:
Build your credit as an authorized user on another person’s credit card account. As an authorized user, you can use the account freely, but won’t be directly responsible for making payments to the lender. The account owner is essentially trusting that you’ll use the credit card responsibly while you piggyback off of their good credit to build up yours.
When using new credit accounts after going through bankruptcy, it’s essential that you confirm with the lender that it reports your activity to the three major credit bureaus.
On top of that, make sure payments are being made on time and that you’re keeping your credit utilization ratio well under 30% to ensure your credit score doesn’t get dinged.
These “credit fix” or “debt solution” companies can advise and act on your behalf to challenge any incorrect listings on your credit report. Credit repair agencies can’t magically fix your credit report after bankruptcy, instead they set you on the right path and teach you the basics of getting your score going in the right direction.
Even though you can teach yourself about credit repair, some people would rather save the time and go direct to the experts. When getting a credit repair agency to help you improve your credit report, make sure you compare different options and research their services so you know exactly what you’re paying for.
The silver lining is that now you can start to develop and practice financial habits to reclaim your creditworthiness after dealing with bankruptcy.
By maintaining full control of your credit and staying between the lines of your budget, you can focus on improving your credit report to get your financial life back together again.
From auto loans and mortgages to reporting services, you can boost your score without plastic.
Find out how to rebuild your credit score and get another mortgage after foreclosure.
If a missed payment left a black mark on your credit report, a letter to your creditor could reverse it.
Offers a flexible three-tiered membership, but beware of customer complaints of fraudulent charges.
CreditRepair.com offers TransUnion credit monitoring as part of its credit repair package, but membership can be pricey.
Sky Blue Credit has a 90-day money-back guarantee, but you’ll pay out of pocket to get access to your credit report.
The Credit People offers professional credit repair services to help clean up your credit report before your next credit application.
Follow these 3 simple steps to remove errors, blemishes and defaults from your credit report to take control of your finances. Understand how black marks can impact your credit score and what you can do to repair your credit.
From loans to credit cards, learn why and when lenders list debts as default, what the consequences are and how to deal with credit default. It’s important to understand what a credit default is and how it can affect your credit score and report.
