Rebuilding Credit After Bankruptcy
Many believe that bankruptcy marks the end of one’s financial life. Yet, the truth is—bankruptcy establishes a fresh start so that individuals and families can move forward and make better choices for the future. In fact, it’s possible to rebuild your credit after bankruptcy when you apply the right strategies early on.
It’s true—financial bankruptcy creates negative remarks on one’s credit report, as explained by Debt.com. In essence, every missed payment or overdraft and collections account will be documented. When bankruptcy is finalized, many of these remarks can be removed, and some are listed as “settled.” While the process of updating this information is on the slow side, the credit rebuilding process can begin through credit correction once all is clear.
As individuals begin to build their credit again, it’s wise to obtain an open credit account. It’s important to understand that the credit card will most likely require some sort of deposit to open the account. Even so, when purchases are made and paid off intentionally, it slowly builds credit on the individual’s behalf.
Another consideration is the mixture of debt one takes on. For instance, it is not smart to only have credit card debt. Thus, taking out a small loan is ideal. This loan might be used for home renovations and repairs, as well as important investment-type purchases. Doing so not only builds credit, it establishes a better outlook for the future. On the other hand, high-risk borrowers may apply for an auto loan as a way to create diversity with debit.
Finally, to stay on top of one’s changing credit score following bankruptcy, it is a good idea to use a credit monitoring service in addition to ID theft protection. As such, individuals can see and be encouraged by their standing in regards to credit. Additionally, they will know when they have recovered enough of a score to take on larger loans or expenses.
Personal And Attentive Bankruptcy Attorneys
At Gingold & Gingold, LLC, we provide the personal care and attention that individuals deserve, whether they are navigating the process of bankruptcy or working to build their credit after. With several locations throughout metro-Atlanta, we invite you to call us today for a free initial appointment.
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195 14th Street NE #1604
Atlanta, GA 30309
Phone: (678) 915-2634