Bankruptcy Is Not The End Of Credit, It’s The Beginning
Contrary to popular belief, bankruptcy is not the end of credit. A person who files bankruptcy will get credit again sooner than expected.
Most bankruptcy filers are bombarded with auto loan offers and credit card offers after the bankruptcy case is filed.
Creditors know that a person cannot file bankruptcy again and they know that most people are anxious to re-establish credit.
Methods of Re-Establishing Credit
A person who files bankruptcy can re-establish credit almost immediately after the case is over. Credit scoring companies examine several factors when computing a person’s credit score.
While credit reporting agencies will not disclose their methods of computing a person’s credit score, certain factors are very important to them and these include:
- Payment history (i.e., whether you have paid bills late)
- Amount of debt outstanding
- Length of credit history
- Amount of new credit applied for
Getting a credit card–and only one credit card–shortly after the bankruptcy is over is a good method of rebuilding credit.
Of course, the person must pay the credit card debt in a timely fashion and otherwise take action to maintain his or her credit-worthiness.
What if there are errors on my credit report?
People often ask: “When can I buy a house?” Most mortgage companies want a person to be 2 years post-bankruptcy. Thus, if your bankruptcy is discharged on November 30, then you have to wait 2 years from November 30 before you can close on a house.
We advise people to obtain a credit card immediately after the bankruptcy and then make their payments in a timely fashion. If the person is careful about his/her credit, then s/he will be able to obtain pre-approval for a mortgage loan.
We Understand Credit Restoration After Bankruptcy
Unsure of whether or not bankruptcy is right for you? Want to see if you are eligible for bankruptcy? I am ready to discuss all your options with you in a free case evaluation. Find trusted, dedicated advice today at John Steinkamp & Associates.
Unsure of whether or not bankruptcy is right for you? Want to see if you are eligible for bankruptcy? I am ready to discuss all your options with you in a free case evaluation. Find trusted, dedicated advice today at John Steinkamp & Associates.
