How To Recover From Bankruptcy And Rebuild Your Credit Score

Financial hardship can blindside anyone. If you've suffered through difficult times and had to file bankruptcy, you may think that your credit standing is doomed. Hopefully, you consulted with a knowledgeable bankruptcy attorney prior to filing, but even if you did not, there are ways to help enhance the process of rebuilding your credit rating.

Document Your New Credit Score

The first step in recovering from a bankruptcy is to establish your new credit score. A month after your bankruptcy is finalized; secure a credit score from all three major credit reporting agencies. Check them against one another and address every discrepancy. These reports are the foundation from where you will begin to repair your credit rating.

However, you also need to know exactly how many points your credit score dropped once the bankruptcy became effective. You may be surprised to find that bankruptcy is not as devastating to your score as you imagined.

Repair Your Credit Score

Once you've established how low your credit score fell as a result of your bankruptcy, your goal is to begin the process of steadily bringing it back up. There are some things you can do, which will help bring your credit rating back to respectability.

• Meet With A Bankruptcy Attorney

Hopefully, you did not file for bankruptcy on your own, but if you did, you can still get a lot of helpful suggestions and guidance from a bankruptcy attorney. Many will offer you a free initial consultation, explaining exactly what they can do to help you.

One vital thing an attorney can do, is address and correct any discrepancies you may have encountered when you generated your post bankruptcy credit reports. This step is critical.

Do not allow inaccuracies to remain on your report, as it will only undermine your efforts to rebuild your credit rating. It is wise to use an attorney to file for bankruptcy, but even smarter to consult with one as you begin your recovery process.

• Building New Ratings

You're going to need to begin to put positive things back on your credit report to improve your score. This can be done by applying for a secured credit card from a bank or private lender. There are small personal loans you can apply for where you must post collateral against the loan.

Sometimes the interest rates can be substantial, so be very cautious about how you use this option. The idea is to borrow a small amount of money that you can clearly make all the scheduled payments. Make sure you use only respectable agencies and be certain they report to the credit bureau the progress of your loan.

There is also the option of speaking with account managers for your utility companies, or rental agencies if you rent your residence. If you explain yourself, agencies will regularly submit a report to the credit bureau on your payment history. Again, you must be sure to make all your payments on time, if not you'll do yourself more damage than good. As you strive to rebuild your credit rating, any positive things that you can have posted to your record will help restore your score.

Plan to be patient; restoring your credit takes time. Be careful not to fall victim to one of the hundreds of fraudulent claims, which boast that they can instantly restore your credit rating by removing a bankruptcy. They cannot do it.

While you gradually rebuild a credit rating, it's always helpful to consider the advice of a knowledgeable bankruptcy attorney before you make any decisions. For more information, visit websites like http://timgeorgelaw.com.