Rebuilding Credit After bankruptcy

If your past history of credit has been flawed by a bankruptcy, the most important thing for rebuilding credit after a bankruptcy is to add positive information into your credit report. The key to re establishing your long term credit credit is to show creditors that you are now financially responsible after the bankruptcy.

If you have bad credit history because of a bankruptcy there are fast simple ways to rebuild your credit after bankruptcy. One of the easiest ways is to apply for a secured credit card. A secured credit card is backed by money that you deposit into an account. If you fail to make your payments the creditor takes the money out of the account to cover the amount owed. Because of the secured funds these types of cards are very easy to get and almost all of them report to the credit beraus. Normally after 6-12 months of on time payments you may be able to qualify for a unsecured credit card, however credit beraus do not know if a credit card is secured or unsecured so a secured credit card is not a necessity in the first 12 months of credit rebuilding.

Rent to Own centers are another great place to rebuild credit after bankruptcy. Many of these rent to own centers will approve an account for a person with bad credit as long as they have the income to pay the loan back and sufficient on the job time. The drawback to opening one of these accounts is that you will pay a much higher price for an item then if you just went out and bought it. However the overall boost to your credit score and profile more then make up for the extra cost of the item. After 6-12 months of timely payments on your secured credit card and rent to own account you can begin to apply for other credit. However only open 1 new account every 6 months and keep the credit inquiries to a bare minimum. Your end goal is to have 2 open credit cards with credit limits over $2500 and one or two additional accounts such as a gas card or department store card.

In addition to these tips you should also review your credit report and make sure all accounts that were included in the bankruptcy are listed on the credit report as "Included in Bankruptcy". In many cases credit accounts that were involved in the bankruptcy will still report as a delinquent account on a credit report. This will have a negative affect on your credit rebuilding efforts. These accounts can be easily disputed online or through a credit repair company.



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