When you filed for bankruptcy in Oklahoma, you may have assumed that your credit would be ruined forever, preventing you from ever qualifying for a mortgage or obtaining new credit. Not quite. Although bankruptcy does cause your score to drop in the beginning and will remain on your credit report for 10 years, there are steps you can take to rebuild after discharge. Let’s take a closer look at four of them.
1. Examine Your Credit Report
After your bankruptcy case is discharged, get copies of your credit report from all three of the major credit reporting agencies (Equifax, TransUnion, and Experian) and review them carefully. If any of the debts you included in your filing are still listed as delinquent, send a written dispute to the credit bureau in question so that the information may be corrected.
2. Develop Good Money Management Practices
If overspending or problematic money management skills caused or even contributed to your bankruptcy, take control of your finances by creating a budget and sticking to it. Thirty-five percent of your FICO score is based on how faithfully you pay your bills, so ensure that you pay them on time and avoid any late or missed payments. Over time, as you demonstrate responsibility with your bill payments, your credit score will rise.
3. Get a Secured Credit Card
Credit cards are great for rebuilding your credit, but you might not be approved for one in the months immediately after your bankruptcy. If this is the case, try applying for a secured card. With these cards, you provide a specific amount of money to the card issuer and receive a card with an equivalent credit limit. When you pay it off each month (or at least make the minimum payments on time), your credit score will improve and the issuer may allow you to graduate to an unsecured card. Just be sure that you choose a card that reports your account to the credit bureaus.
4. Take Out a Small Personal Loan
Talk to your bank or credit union about taking out a small personal loan. It doesn’t have to be much - all you want to do is boost your credit score by paying it back swiftly. Depending on which lender you work with, you may even get a better rate of interest than you would with a secured credit card.
When you’re trying to rebuild your credit after bankruptcy, your best course of action is to make prudent financial decisions. When you overcome any personal shortcomings that may have led you to file in the first place, it will go a long way towards getting your credit - and your finances - back on track.
If you are experiencing serious debt challenges and wondering if bankruptcy is the answer, contact the Law Offices of B. David Sisson. Attorney Sisson will listen to your concerns, carefully evaluate your financial situation, and recommend the best debt relief option for you. To schedule a consultation, contact us today.