Once our clients make the decision to file for bankruptcy, we will inevitably get asked some version of the question: “When will I be able to have credit again?” It is important to know that in most cases, your credit score will remain low or unchanged until you receive your discharge. Once that happens, the following are ways that you can check on your score and work toward improving your credit score:
- Review your Credit Report – We would suggest waiting a month and then pulling your credit report from a credible free site, such as www.annualcreditreport.com, and verifying that all of the debts listed and discharged in your bankruptcy have been correctly marked and/or labeled as discharged and reflect a zero balance owed. Be sure to dispute any incorrect information directly with the credit bureau and provide copies of any requested information.
- Open a Secured Credit Card – Many Lenders now offer secured credit cards, which give you, the borrower, access to a credit line. This credit line is secured by a security deposit given to the Lender by you. For example, if you are approved for a line of credit of $400.00, you would make a deposit equal to that amount. When researching which card would be the right fit for you be sure to only consider those that will be reporting all of your timely payments to all three of the major credit bureaus (Equifax, Experian and Transunion) and that any fees or interest charges associated with the card is low. Once you find the secured credit card that is the right fit for you, be sure to use the card to cover small purchases, i.e., groceries or gas. The goal is to be sure that the remaining balance is as low as possible, when compared to the amount of available credit. That will help you ensure that your credit report receives positive remarks, which should translate into an increase in your overall credit score.
- Keep a Close Eye on Your Progress – In general, it is very important to keep a close eye on your credit report – it can change quickly and often. However, to ensure that all of your hard work rebuilding your credit is paying off be sure to routinely check you report to verify that all of your payments are being properly reported.
In the end having a positive payment history – low balances and timely payments – is the key to rebuilding, improving and maintaining your creditworthiness after bankruptcy.