As if the stress of being in debt was not enough, you now have to deal with the aftermath of filing for bankruptcy. Will your credit score ever recover? It will take between seven and 10 years for bankruptcy to be wiped from your credit report, but you can take some steps right now to begin building your score back up.
Step 1
Clear up credit errors. Get free annual credit reports from Experian, Transunion and Equifax through the Annual Credit Report website. By getting reports from three different reporting companies simultaneously, you will be able to compare them side-by-side and take note of any discrepancies or genuine errors. You may find anything from misspellings to accounts that are still being considered open and overdue when they were actually closed and debts cleared with your bankruptcy. Contact the company whose report was responsible for the error and offer proof (e.g. printed out payment histories) to cover your tracks. Wait 30 days for the credit company to correct the error.
Step 2
Pay down other debts. Debts, such as student loans, mortgages and car payments, aren't usually discharged when a person files for bankruptcy. Having some non-discharged debt can work to your advantage when you want to build your credit score back up. Making prompt, larger-than-minimum payments will give you the opportunity to show lenders that your credit habits have improved. Rearrange your finances so that you never have to worry about affording minimum payments.
Step 3
Get a secured credit card to build revolving credit. If you ha recently filed for bankruptcy, chances are slim that you will be able to obtain an unsecured credit card. However, you will likely be able to get a secured credit card. Visit your bank and inquire about opening up a secured credit card. You will need to make a deposit at the issuing bank in order to obtain credit; your credit limit will be roughly equal to that amount. Assuming you pay your balance every month, you should be able to expand your credit limit.
Step 4
Slowly build credit. Avoid charging any more than 30 percent of your existing credit limit or else you risk doing further damage to your credit score. Use your card consistently but not excessively in order to improve your score. If you have a tendency to forget how much you've already used, pick one type of purchase (such as groceries) and only use your card for it. If you're not sure whether you will be able to pay off the whole balance within a month, use cash.
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