What to do after Bankruptcy.
Bankruptcy is sometimes hard to avoid, especially during tough economic times. Let’s face it, nobody wants to file bankruptcy. There are two types of common bankruptcies. They are Chapter 7 and Chapter 13. Once your bankruptcy is discharged you will need to re-establish your credit score with each credit bureau.
Instructions:
1. Make sure you pay all your current bills on-time. You definitely don’t want troubles after a bankruptcy is on your credit report. Have a realistic budget and stick to your budget. If you find that you are having problems paying any debts, make payment arrangements with your creditors. Creditors will typically work with emergency circumstances. Remember your payment history accounts for 35% of your overall credit rating.
2. Get a family member to add you as an authorized user on a credit card. This will allow you to ride the coat tail of someone that has good credit. Also get a couple of secured credit cards. Secured credit cards are a great way to re-establish credit.
3. Establish at least 3 lines of good credit on your credit report. This is very important. I know that maybe credit card got you in trouble to begin with, but they are a necessary evil. With 12 to 24 months of good payment history you will see an improvement in your credit scores.
4. Get some installment loans. Installment loans are a great way to re-establish credit after a bankruptcy discharge. Typically car loans are easier to get when you have low credit scores.
5. Have savings for emergencies. Any financial adviser will recommend that you have 6 months worth of income in savings. When something happens you have some breathing room until you can resolve matters. If you don’t have any savings, then avoid all the little pleasures, like eating out, going to the movies, shopping for clothes, etc….until you have 6 months income in the bank.
Author: Mike Clover
CreditScoreQuick.com
