Many people use bankruptcy as a last resort when their debt reaches a point where they will have extreme difficulty repaying it. Unfortunately, bankruptcy will leave a blemish on your credit that will be hard to recover from. While your credit isn't ruined forever, it will take some work to get it looking good again to creditors. Consider these 4 methods that will give you a credit score boost.
Double Check Your Credit Score
Even though you filed for bankruptcy, it's possible that there are still some debts on your credit report that should have gone away for good. Take some time to double check your credit score, and that all your discharged debts do not have a balance anymore. If a debt wasn't removed from your credit, trying to fix your credit is going to be harder.
Open A New Credit Card
Part of building up good credit is to show that you are responsible when given credit. You can do this by opening up a new credit card account and not using it too much. It's ideal that you only use 10–20% of the credit that you are given. That means if your credit limit is $1,000, that you should only have a balance of at most $100–200 at any given time. Of course, you should be paying off the balance every single month so that you do not have any interest charges.
Keep in mind that you might not be able to get an unsecured credit card at first. You will need to secure the card by putting down a deposit that is equal to your credit limit.
Get A Loan
If you do need to make a large purchase, especially for an item like a car, you will need to get a loan. A bank may not be as willing to give you a loan so soon, but you can seek financing from alternative sources. Check with the dealership to see what kind of financing they offer. Showing that you can repay an auto loan, even a small one for a used car, will help build your credit history as well.
Piggyback On Someone Else's Credit
For those that have trustworthy family members with good credit, you should ask them to add you as an additional authorized user for their credit card account. Even if you never use the card, their payment history will be reflected on your credit history. Of course, this requires that they pay on time and have proper credit utilization.
For more tips on how to improve your credit, speak to a financial lawyer like Philip L. Burnett, Attorney At Law.
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