If you filed bankruptcy, you may have a positive outlook about the future of your finances. But since filing bankruptcy likely damaged your credit score, you may want to find a way to build it back up as quickly as possible.
It can take time to rebuild your credit following bankruptcy. But the following strategies can help you build credit without sliding back into significant debt.
Monitor your credit report
Your credit report, according to the Consumer Financial Protection Bureau, includes information about your credit situation and credit history. As you work on improving your credit following bankruptcy, review your credit report regularly and dispute any discrepancies on it.
Use credit carefully
Using credit with caution after you file bankruptcy can help you rebuild your credit score. Reduce how often you use your credit card, keep the balances on your credit cards low, make your payments consistently and on time and work on building an emergency fund to cover unexpected expenses.
Try a secured credit card
Using a secured credit card can help you improve your lending trustworthiness in the eyes of lenders. With a secured credit card, you put a refundable security deposit on the card and then borrow against it over time.
How long it will take to rebuild your credit after you file for bankruptcy depends on a variety of different factors. Although improving your credit score is important, focus more of your efforts on solidifying positive financial habits and finding ways to reduce your reliance on debt in the days and months after you complete the bankruptcy process.