How you manage your credit after the bankruptcy can be one of the most important factors in rebuilding a strong credit profile. Following are the steps one can obtain to recover their credit score after bankruptcy:
Introspection: One of the most important things to do is to look back, scrutinize and probe deep to figure out what led us to this situation.
It can be due to over spending or irresponsible handling of credit, lack of an emergency fund ECT
FICO score: Your FICO score is the numeric description of your financial liability, based on your credit history. These FICO scores are calculated while evaluating credit history, by the lender especially after bankruptcy.
Review credit report: Get hold of copies of your credit report--including your credit score--from all three major credit reporting agencies in the undeviating impact of your bankruptcy discharge. Reviewing your credit reports and noting your credit score from each of these agencies gives you a starting point for observing changes following your bankruptcy. The three major U.S. credit reporting agencies are Experian, Equifax and Trans Union.
Credit Repair Schemes to Avoid:responsibility is the most important building blocks of a strong credit profile. There really aren't any shortcuts. Some credit repair companies charge high fees for things you can do yourself, or encourage illegal activities, like providing false information when applying for credit. Beware of credit repair schemes and don't jeopardize your fresh start after bankruptcy.
Try not to carry balances: You don't want to build up debt again, and the higher the entitlement of balances to your total available credit boundary, the more negative the impact will be on your credit score. Some credit card issuers will let you to open accounts soon after you've completed your bankruptcy case. They know you've confronted your financial problems, and you won't be able to seek bankruptcy aid in the near future. After your bankruptcy case is over, you'll have to wait six to eight years before filing another Chapter 7 bankruptcy case. For Chapter 13 bankruptcy, it's a two to four-year wait. It goes without saying that if you've filed for Chapter 13 bankruptcy, fulfilling the terms of your repayment plan is a must.
Check your credit report and your FICO score once in a year.
Having no credit cards at all OR while having credit cards and managing them responsibly can lead to a high credit score.
Keep your balances low or, if possible, pay them off completely each month.
Don't open credit cards that you don't need just to increase your available credit or because you want it to look like you have a better mix of credit.
Shop for auto or mortgage loan rates for within a set period of time. FICO scores discriminate between a search for a single loan and a search for many new credit lines by the length of time over which investigation take place
Don't close credit cards to try to raise your score. Closed accounts show up on your credit report.
Repair your credit history by Opening new accounts responsibly and pay the bills on time.
There is absolutely no need to panic. The whole world is impermanent, so is our credit record. It stays on our credit report for a couple of years. That does not mean there is no a ray of hope. By all means no. As soon as the bankruptcy case is closed, with some planned measures we can slowly yet steadily build up our credit rating.
Rebecca Miller is the eminent writer of this article. Here in this article she has discussed about possible steps that one can obtain to manage credit in a proper way after the bankruptcy process.
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