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Life after Bankruptcy

It’s unfortunate that in today’s economy, many have found their credit suffering. Add a bankruptcy to the equation and credit scores can take a seemingly permanent nose dive. But in a time when people are staying clear of credit cards, how does one recover their credit after bankruptcy?

According to a recent column in the Orange County Register, there are a number of steps to take to help rebuild your credit after bankruptcy.

First, get a copy of all three credit reports (get it free from annualcreditreport.com) and make sure all the information is correct. A bankruptcy can remain on your credit report for up to 10 years. According to the Fair Credit Reporting Act, you can dispute inaccurate and incorrect information. If the creditors do not respond to the disputed item within 30 days, it will be removed from the credit report. This also includes public records that would have your bankruptcy listed.

Second, you need to have active revolving and installment credit being reported on your credit report. This DOES NOT mean you need to have debt to have credit. Instead of keeping balances on your credit cards, keep track of what you spend and pay them off every month.

If you don’t have a credit card, you may need to start with a secured credit card. A secured credit card is a card given by your bank with a credit limit of an amount you deposit into an account. Always make your payments on time and as your credit becomes stronger you can later apply for an unsecured Visa or Mastercard without having to secure it with a deposit.


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