OF COURSE - BANKRUPTCY
LOWERS YOUR CREDIT SCORE . . .
It's what you do AFTER bankruptcy
makes all the difference in the world!...
IT DOESN'T TAKE AS LONG TO GET BACK ON YOUR FEET
AS YOU MIGHT THINK! . . .
IMMEDIATELY FOLLOWING BANKRUPTCY YOU NEED TO......
Look over your credit report. Check what entries are marked correctly. If you do not yet have a copy of your report, there are a few options to get your credit report - with or without your score.
Once your bankruptcy is discharged, all entries on your credit report need to be marked with balances of 0 dollars. Unfortunately they will also be marked with something to the effect of 'included in bankruptcy".
There are a few ways to handle this:
Utilizing a credit monitoring service can give you an edge because it gives you the ability to dispute your credit entries online and watch your accounts to be sure they are updated - right from your computer, in minutes. When using the credit monitoring service you have the option to see your updated credit report and score periodically to make sure you are on the right track.
If you opt not to use a credit monitoring service, another way to make sure that the credit bureau's have correct information listed is to send a copy of the following items to each credit bureau.
- a copy of your drivers license,
- a utility bill showing your current address,
- and of copy of your 'discharge paper' from the completed bankruptcy.
The addresses for each bureau are on your credit report, usually near the end of your report.
***
Do not send you disputes in the mail with a signiture requirement as the bureaus will not accept the letter as most of them use a post office box to collect their mail.
Circle the date on the copy your discharge paper with a bold marker, or highlighter. Write a quick letter simply stating that your accounts are incorrect and you would like them to be updated to contain the correct information. State that you have filed and been discharged from your bankruptcy and specify the date your discharge was filed. Highlight the date of discharge on your letter as well-especially if your bankruptcy has been discharged a while back.
Within approximately 30 days from the bureaus receiving your request, you will receive confirmation from the credit bureaus that your entries have been marked correctly. Go over the paperwork that you receive, and be sure that each entry is marked correctly.
**The discharge paper from your bankruptcy is an important document. Keep it in a safe place, and only send copies to any one requesting it! You will need it over the next 10 years to prove that the bankruptcy is complete and that you no longer owe the debts listed, and believe me, you will need it! Especially when obtaining financing for a home or auto!
Reaffirming debt - can be great for your credit score . . .
In the event that there are accounts that you kept out of your bankruptcy or 'reaffirmed' and are paid on time, the positive credit from those accounts does continue to affect your report in a positive way. (Be sure to check that the account you agree to keep is properly marked on your credit report that it is open and paid on time! - sometimes they tend to get lumped with the other accounts and are marked as part of your Bankruptcy.) This is a great time to have a credit monitoring service. Having the service is much better than guessing when your score is high enough to apply for new accounts, or hoping that all your accounts were marked properly.
REMEMBER: Accounts that you have kept out of your bankruptcy help you build a solid credit report as long as these accounts are kept in good standing, and paid on time.
Click here if you are looking for information on Chapter 13 Bankruptcy, how it works, and what the advantages and disadvantages are!
Click here if you are looking for information on Chapter 7 Bankruptcy, how it works, and what the advantages and disadvantages are!
BUILDING YOUR CREDIT AFTER BANKRUPTCY. . .
If you reaffirmed debt during your bankruptcy you are on the right track. You will most likely need to open other accounts to build your credit. It is crucial to only apply when you are fairly sure you will be approved and when you are completely ready to take on the payment the new credit will create. Multiple inquiries on your credit will lower your score.
Avoiding late payments now is crucial!
Do not let any payment even get close to being 30 days late! Banks want to see lines of credit that you have made on time payments to, the longer the account is open and paid on time, the more it affects your score in a positive way!
IIf you have no current positive accounts on your credit file, we need to add some positive items rather quickly. The longer the accounts are open, the more positive weight they will add to your credit report!
To start building positive credit entries on your credit report, here are some great info on GREAT WAYS TO BUILD POSITIVE CREDIT.
The main task at hand now is to eliminate any chance of negative entries reaching your credit report in the future, don't be hasty to cause yourself debt if you cannot afford to pay for it! This is your chance to build your future, starting from scratch.
Using credit cards can be a great way to establish credit, however you ARE paying more for your purchases in the end! Interest adds up! Your credit file will be what you make it! As long as you manage your credit cards wisely they can be a great asset!
Read through this site, gather all the information you can. There really isn't much to learn before you are on top of your credit rating, however there are a million people out there that will steer you wrong if you let them! There are many key facts you need to know.
***LET ME MAKE THIS VERY CLEAR - I AM NOT AN ATTORNEY! Specific matters need to be handled by a legal professional. This is not legal advise, if you even think your questions may require professional legal consultation, by all means contact an attorney right away - every situation is unique! Your bankruptcy attorney should know the answers to most of your questions through experience, however if he/she does not - finding an attorney that can give you the answers you need is only a few phone calls away! As far as raising your score goes you need to get some accounts on your credit report so that you can start proving that you are able to make on time payments. Don't procrastinate - get started - it's up to you!