Ways to Build Credit After Bankruptcy
Depending on the type of bankruptcy you’ve filed, a bankruptcy can stay on your credit report for up to 10 years, but rest assured the damage is not permanent.
There are steps you can take to build your credit immediately after the bankruptcy is closed and completed. Below are few ways to help build your credit after bankruptcy.
- Check your credit report regularly for any possible errors – keeping an eye on your credit report can help you find and dispute any errors before it is too late. The accounts that were discharged need to be reported as “discharged” and must have a $0 balance for it to reflect correctly on your credit report. The bankruptcy filing date also needs to be accounted for because it remains on your report so accuracy here is extremely important.
- Consider securing new credit – getting new credit can be a challenge but it’s important to keep in mind that you may still qualify for certain types of cards. Some secured cards may require an upfront deposit which protects the lender and in exchange you get a credit limit that is usually equal to the deposit. Another option is a retail card but ensure you read the fine print because many have high interest rates and penalty fees. Keep your balances low and make sure to pay the monthly payments on time.
- Start a budget and stick to it – having a budget and being able to stick to it should be your top priority. This will help keep you out of debt and distribute your income in a matter that makes more sense for your financial situation. Assess the income you have on a monthly basis and from there you can work out the details of where the money needs to be distributed to.
- Consider a credit builder or secured loan – A credit-builder loan is designed to help you build credit and it does work differently from other types of loans. The money does not come to you upfront, instead the lender puts the loan in a savings account until all of the payments have been made. When the loan term is over, you can collect the cash and if you have made the payments on-time, you will most likely help you credit.
Rebuilding your credit after bankruptcy is very possible and not all hopeless. If you need assistance in getting started, feel free to give us a call or text today at (206) 408-8158. We look forward to hearing from you.
19803 1st Avenue S.
Normandy Park, WA 98148
T (206) 408-8158
F (206) 374-2810
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