6 Ways You Can Help Your Credit after Filing for Bankruptcy
By the time you decide to file for bankruptcy, your credit has likely been on a downward spiral for some time. Your credit report is probably littered with delinquencies, excessive credit inquiries, and credit accounts that are maxed out. Your score is probably in the toilet.
You may worry that filing for bankruptcy will make your credit even worse. While it’s true that bankruptcy is a black mark on your credit report, it can also help your credit score by getting rid of those maxed-out accounts. Plus, you can take steps after you file for bankruptcy in Gilbert to get your finances back on track fast. Here are six things you can do to help your credit after filing for bankruptcy in Gilbert:
1. Identify the Source of the Problem
Before you can figure out how to fix your credit, you need to figure out how it got ruined in the first place. Did you truly get off track because you lost your job? Then you need to create a significant savings fund to tide you over in case of a future emergency. Or did you get a little too spendy with your credit cards? Now you can put yourself on a strict budget and stick to it.
Be honest with yourself to identify the source of your problem so you can implement a solution.
2. Set a Budget
Whether you got into trouble with debt because of spendthrift habits or because of circumstances that you couldn’t control, you definitely need to be strict about your budget after bankruptcy if you want to rebuild your credit. Any late payment will be further evidence of you being a credit risk.
Make an honest assessment of your income and your expenses, and create a modest spending plan. Be sure to leave a little room for savings, in case you end up with unexpected expenses one month.
3. Pay Everything on Time
Creating a history of on-time payments is one of the best and easiest ways for you to rebuild your credit after a bankruptcy. You are showing that you are responsible with your money and that you are meeting your obligations.
Make sure that you pay everything on time. Pay your bills a bit ahead of time if you must. Just make sure the money gets there on time, every time.
4. Take Out a Small Line of Credit
You can start getting credit a few months after you file for bankruptcy in Gilbert, depending on how good you are with your finances. You should stick to credit cards like gas or retail cards that have a limit of a few hundred dollars. Charge a little on it each month and pay it off each month.
5. Keep Your Credit Inquiries Low
You may not get accepted for lines of credit when you first start applying. Don’t keep applying! Give it a little time before you apply again. Having too many credit inquiries in too short a time can also bring down your score. Spread out your inquiries to protect your score.
6. Don’t Overspend
Filing for bankruptcy frees up a lot of money in your budget by discharging your debt or helping you pay down your debt. You may feel invigorated by the excess cash in your budget, and you may feel motivated to spend. Resist that urge.
Keep your spending under control to keep your finances on track and to help your credit improve. Otherwise, you’ll be looking at another setback.
Bankruptcy can significantly help your finances by offering you relief from overwhelming debt. Bankruptcy may be a black mark on your credit, but if you use it properly and implement the right strategy after your discharge, you can quickly rebuild your credit. In fact, you can restore your credit faster than you would if you tried to just pay off the debt yourself.
Call Gilbert Bankruptcy Lawyers to learn how bankruptcy might help you to reclaim your life. Bankruptcy can give you debt relief that allows you to take control of your finances again, so that you can breathe a sigh of relief and start making your money work for you. Call us in Gilbert to talk with a bankruptcy attorney about your options. We help clients with Chapter 7 bankruptcy and Chapter 13 bankruptcy, and we represent both individual and business clients.