Resurrecting one’s credit rating is one of the primary goals that bankruptcy debtors have. While it may appear insurmountable at the outset, it is actually possible to do so with careful maintenance of the credit opportunities that will come about.
Believe it or not, lenders and credit card issuers want the business that comes from debtors emerging from bankruptcy. They believe that these customers have a strong desire to re-establish their credit ratings, and will take their responsibility with credit very seriously. As such, it is very common for debtors who have recently received discharges to have a flood of credit card applications come their way.
With that said, there are a few helpful tips that debtors can use to ensure that their credit is rebuilt the right way.
Become an authorized user – Debtors with poor credit ratings can reap the benefits of another consumer’s responsible credit use by becoming an authorized user on their card. Essentially, it’s the best of both worlds; getting the benefit of a good credit rating while not having the responsibility of paying the monthly bill.
Monitor your credit report – Debtors who recently received a discharge should have it reflected on their credit report. Basically, the debts discharged should show zero balances. If they do not, it is important to dispute any errors so that the report is correct.
Keep balances low – It was probably advised in pre-discharge training, but it is important to keep new balances low. A large part of one’s credit score is based on the amount of unused credit available, so keeping low credit card balances is essential to rebuilding credit after bankruptcy.
If you have additional questions about post-bankruptcy life, an experienced attorney can advise you.