One of the benefits of bankruptcy is the ability to start with a clean slate…a fresh financial start for those who have been toiling in debt for years or even decades. However, those who are considering bankruptcy may be ambivalent about their ability to have good credit once again. After all, who wants to pay thousands more for car or home loans because of high interest loans set aside for people who have a previous bankruptcy.
Despite this likelihood, it is possible to obtain a good credit rating after bankruptcy. There are a few steps that can be taken to improve one’s chances.
Open new credit card accounts – This may seem counterintuitive, but having credit, and managing it wisely, is a good way to improve your credit score. After all, part of your score is based on how much open credit you have on your revolving accounts.
Maintain on-time payments – While this may go without saying, but having consistent, on-time payments will increase the sense of trust among credit card issuers. This is also an opportunity to establish specific payment dates so that you will not have to pay all your bills at once, and run the risk of making a late payment.
Stay aware of things on your credit report – After your discharge, the balances on your previous accounts should be zero; or at least there should be a notation that the balance was discharged in bankruptcy. However, it is prudent to stay on top of your credit report to ensure that all new activity is reported correctly.