Rebuilding Your Credit After Filing Bankruptcy
March 7, 2016
It’s worth noting that if you’ve filed Chapter 7, after filing, you’ll have a much more attractive debt-to-income ratio for lenders. And you also won’t be able to qualify for filing again for at least another eight years, which is also appealing to lenders. This is good news when it comes to starting with a clean slate of credit.
Be careful, though! Credit card companies know this, and many will come after those who have recently been discharged from bankruptcy, trying to get them to sign up quickly with extremely high interest rates.
Here are some other things to keep in mind as you begin to rebuild:
• Don’t attempt to borrow money too quickly. Try to wait until your credit score rebounds to around 650.
• Be aware and on top of your credit report. Learn how to read it, and be aware of any potential errors or mistakes.
• Start saving. Having a reserve of cash is a great way to get back on your feet after bankruptcy, and you’re in a great position to begin doing so. A good rule of thumb is 10% of your income, but anything is better than nothing. And try to make deposits into the account regularly. This is the best, and safest way, to begin rebuilding your credit score.
• Continue working to pay off secured debts, such as liens on houses or cars. This will help rebound your credit rating more effectively and safely than high-risk credit cards.
• Steer clear of lending scams and payday loans.
For more information on living a debt-free life post-bankruptcy, contact the Law Office of George R. Belche today.