Filing for bankruptcy can be a way to relieve yourself of the burden of debt when you can no longer afford the cost of living because of your mounting debt. When filing for bankruptcy, many people worry about how bankruptcy impacts credit. After all, your credit score controls your ability to rent an apartment, buy a house and much more.
According to Bankrate, filing for bankruptcy is not the end of your good credit. You can rebuild after bankruptcy and restore your credit to good standing.
Monitor your credit reports
Keep a close eye on your credit report. Inaccurate information on your report could cause your credit score to continue falling or make it difficult to boost your score. make sure that all your discharged debts show up on the credit report so that those debts do not count against you as outstanding debts. Debts may also still transfer to debt collection agencies after bankruptcy by mistake.
Open up a secured credit card
A secured credit card functions like a typical credit card except you pay a down payment and serve as your credit line. The bank will take money from the down payment if you have trouble paying your bill. Over time, the secured credit card repairs your credit score, and you may be able to apply for an unsecured card.
Pay bills regularly and on time
After filing for bankruptcy, keep up with your bills to maintain good credit. If you filed Chapter 13 bankruptcy, you must pay off your debt. Your debts become restructured to make paying easier. Make sure you make all of your payments on time to ensure your credit score does not decrease.
Learning from your mistakes with credit cards, loans or other forms of financing can help you rebuild following bankruptcy.