Rebuilding Your Credit
Filing for bankruptcy can destroy your credit. You may find that after filing for bankruptcy it's hard to get loans in your name when there's a bankruptcy on you credit report. Your credit score may be lower after filing bankruptcy.
But is not all doom and gloom.
There is Credit after Bankruptcy
Building your credit back up after a bankruptcy is essential and is completely doable. In fact, it may well be faster to rebuild your credit after a bankruptcy, than if you stay in an unmanageable debt situation for years on end--a situation where your debt load and late payments force your credit score lower and lower, with no end in sight.
There are a few simple things that you can do to begin repairing your credit if you have filed for bankruptcy. It will take time, but with dedication and some guidance from a trusted bankruptcy attorney, you can be on your way to a good credit score, and financial life even better than before your bankruptcy. It's all up to you.
Credit Cards after Bankruptcy
You will be able to qualify for certain lines of credit including secured and retail cards. Secured credit cards require you to make a deposit upfront. Your line of credit will usually be equal to the amount of the deposit you make. Be sure the card you apply for will approve your application with a current bankruptcy in effect or on your record. Retail cards have more relaxed credit requirements, but they often come with high interest rates and fees. If you use this method to build your credit, you must be wise with your spending. Make your payments on time, and do not charge what you can't pay for. Consider paying with your new card for items you would normally pay cash for, and then immediately paying off the credit card balance. Do not max out your cards. Keep your total monthly charges down to 25% of your spending limit or less. And pay off all balances before they are due. After a few months, you should not be surprised to be offered higher spending limits.
Credit Builder Loan
A credit builder loan works like this: the lender will first deposit the amount of money being lent to you into a savings account. You then make payments on the loan. When you finish all the payments, you get the money in the loan savings account. This helps build your credit in two ways: first, it establishes a new line of credit for you which is reported to the credit bureaus. And your making the payments on time shows up on your credit report as a new loan paid off on time. If have credit card temptation problems, this may be a way for you to keep yourself out of spending trouble again, but still be rebuilding your credit.
Reporting Utility Payments
Most of the time utility and rent payments do not appear on your credit report. Those payments are not regularly reported to credit bureaus unless they're late. But if you make your payments on time, you can try to that help rebuild your credit. See if your landlord will report your payments to the three major credit bureaus. He may say 'no,' but it never hurts to ask.
Finally, keep an eye on your credit report. Just doing that will help raise your score. You'll immediately spot errors, and be able to fix them. You may well find in your history, which are inaccurate that you can corrected. If your score drops, you will be able to figure out why, and take corrective action. As it rises, you'll be happier to see your own progress. Liking keeping an accurate balance in your checkbook, this is just good personal financial management.