A bankruptcy gives you the relief of a clean financial slate — but also the worry that you’ll never have decent credit again.
If you have filed bankruptcy, chances are your credit is in tatters. But that’s different from the common misconception that bankruptcy ruins your financial future forever.
The truth is you can begin to rebuild your credit right away.
Although a bankruptcy will remain on your credit reports for 10 years, its impact will fade with time. You can help the process by offsetting the negative information on your credit report with something more positive. In this blog series, I'm going to talk about how to increase your credit score after filing bankruptcy.
Start with the basics
At this point, lenders would like to see that you have enough income to pay your current obligations, and have a little left over. A lighter debt burden makes you a more attractive borrower.
Also, lenders won’t have to worry that you’ll file for bankruptcy to get rid of any new debt; you won’t be able to receive another discharge of your debts for eight years.
Here’s your first order of business: Create a budget to help you stay on top of your finances.
Next, begin building an emergency fund. Research by the Urban Institute shows that having as little as $250 in savings for an unexpected expense can protect families from resorting to payday loans or running up credit cards, which can start a new debt spiral.
If you’re trying to raise your credit score after bankruptcy, we have created an online course just for people like you. This online course will give you simple strategies to raise your credit score to 720, in just 12 to 24 months! That's right - you will be on your way to the best credit score you ever had in two years or less!
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