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Re-Establish your Credit The best way to re-establish credit is to get more credit. Many banks will offer credit cards -- even with no security -- to recent bankrupts. Every current payment helps build your credit. Moreover, your credit score improves even more if you charge no more than 30% of your available balance and pay it off every month. There are many online sites that provide listings of creditors willing to provide new credit to people with poor credit scores. There are even many banks that will provide you with unsecured credit lines.
Many people are surprised to learn that in many cases they may be better risks after bankruptcy. After all, you are largely debt free and a better risk so long as you have enough income to cover future obligations. For instance, most bankrupts can obtain a mortgage at or near market-rate interest after as little as two years. There are a lot of banks that will offer credit cards -- even unsecured credit lines -- even before your bankruptcy is discharged. These cards usually carry low credit limits at first but the limit usually increases steadily as you make monthly payments on time. Again, the key is to never charge more than 30% of your credit limit and pay the card off every month. Plenty of car dealerships also offer financing through local banks for people who have filed bankruptcy. Your payment history on a car loan helps you re-establish your credit. Often, in as little as six months after a bankruptcy filing, your credit score can be higher than it was before you filed bankruptcy.
For an excellent article on how to re-establish your credit after bankruptcy, read this piece on MSN Money by Liz Pullian Westin.
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Denver,
Colorado
matters. He has been practicing law since 1991 and is
admitted to practice in Colorado, Oklahoma, and Texas. He
holds a B.A. from the University of Colorado at Denver and a
law degree from Oklahoma City University where he served as
a staff editor of the Law Review.