Declaring bankruptcy does not necessarily mean that your credit score is ruined forever. Your credit score is a number between 300 and 800 assigned to you by credit reporting agencies as a way to determine your loan eligibility. Initially your credit score will go significantly down, but you can work toward rebuilding it to reach a number that qualifies you for credit and fair interest rates. Although time can help heal the effects of bankruptcy on your credit score, you can do things in the meantime to bring it back up.
Step 1
Review your credit report. You can access free credit report through the FTC-approved Annual Credit Report website. Your credit report may still show certain accounts that were included in the bankruptcy as overdue. Make sure these items are removed by contacting the credit reporting agency. They should show up as closed since they were included in the bankruptcy.
Step 2
Open a secured credit card account. Secured cards are accounts that give you a credit limit based on how much you deposit into the account. These types of credit cards are open to individuals that would not be approved for an unsecured card.
Step 3
Charge a small amount on the secured credit card. To build up your credit score after bankruptcy, you need to show that you can maintain your accounts. Keep at least a 30 percent difference between the amount that you charge and the maximum limit of the credit card.
Step 4
Stay up to date with your installment loans. Installment loans, like student loans, car payments and mortgages, can affect your credit score. Pay all of these loans on time to help build up your score.
Tips and Warnings
- Keep in mind that a bankruptcy can legally stay on your credit report for as long as 10 years. After this time, it will no longer adversely affect your credit score.
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