Filing bankruptcy lands a damaging blow to one’s credit. Not only is the credit score severely lowered, but the bankruptcy remains on the credit report for 7-10 years. That’s a long time to go with crippled credit.
However, due to the economic crisis, millions of Americans have found themselves in such a predicament. Therefore, you are not alone in asking if there is credit repair after bankruptcy. Fortunately, there are ways in which to repair credit once a bankruptcy has been issued.
Get an Unsecured Revolving Credit Card
It may be quite difficult to get a Visa, MasterCard, etc after a bankruptcy and you may need to start off with a gas or department store card. Then, after 6 months to a year, you should be able to acquire a major credit card.
There are companies who may issue you a card after bankruptcy because they know you no longer have a mountain of debt. However, any card you receive will have high interest rates. Just be sure to pay off the balance each month.
Get a Secured Credit Card
In order to hasten the credit repair process, you can get a secured credit card. For this type of credit, you deposit a set amount into a special account which guarantees the bank their money if you default.
Simply make small purchases and make payments on time. Soon your credit score will begin to increase and you will become eligible for unsecured credit cards.
Keep Credit Card Balances Low and Punctually Paid
It is very important when repairing credit after bankruptcy to keep all credit card balances low and paid on time. Your credit to debt ratio is scrutinized and can either positively or negatively impact your credit score. It’s important to have a high amount of credit which you are not utilizing.
Late payments will also cause considerable damage to your credit score, especially if it happens repeatedly. It’s a good idea to set up automatic credit card payments.
Diversify Your Account
Although revolving credit accounts (credit cards) are considered more heavily in the credit scoring process, it is also important to diversify your account by acquiring an installment loan. Buying durable goods such as a car, furniture, etc will add dimension to your account responsibility factor and help to increase your score.
Fix Your Credit Report
Showing responsible payment habits now will only raise your credit score to a degree. If a lot of negative items exist on your credit report, either valid or erroneous, they will act as an anchor to hold down your credit score for some time. Therefore, it is just as important to fix your credit report as it is to establish new credit.
Credit repair specialists at repair-credit-today.com will help you clean up your credit report quickly and efficiently. Contact us today for a free consultation for fixing your credit report and get your life back on track after bankruptcy.