A Chapter 7 bankruptcy can provide you the “clean slate” to rebuild your financial situation, but it doesn’t come without repercussions. The poor credit that results from declaring bankruptcy can have a negative impact on your ability to rent an apartment, obtain a credit card, or pass pre-employment screens. Based in Dothan, AL, The Gil Law Firm represents clients from Alabama, Georgia and Florida seeking debt relief through bankruptcy and a variety of other attorney-provided advice. Here, they share a few pointers for restoring your credit after a bankruptcy event in your life.
5 Tips For Chapter 7 Bankruptcy Credit Restoration
1. Secured Credit Cards
Obtaining a secured card might be a solid option after a bankruptcy. The primary difference between a secured and an unsecured card is they will require a security deposit which acts as both collateral for and defines the available spending limit of your card. A secured card application is likely to be approved because the lender is not subjecting themselves to financial risks. Usage of the cards may begin to assist you in eventually obtaining an unsecured card; however, pay attention to the “fine print” outlining the often high fees.
2. Seek New Credit Accounts
You may encounter opportunities for establishing new credit accounts. Some retailers may extend you low-limit financing to help sell their products. With any such opportunities, you should use it to begin having current credit activity listed on your credit report, but always keep the account in good standing.
3. Monitor & Correct Credit Report
Wait approximately 6 months after your bankruptcy to allow for all related discharges to fully process and be up to date on your credit reports. You will want to verify that all applicable debts that should have been discharged are listed as such. Review any errors or inaccuracies that could be negatively impacting you and notify those creditors and the reporting agencies to make the correction.
4. Finance An Automobile
The automotive industry is a sector that offers financing to those with poor credit at higher than normal rates of interest. This is a very effective way to establish a new positive history of credit activity. Shop around on the rates of interest, as they may fluctuate considerably.
It is important to have patience in the process of improving your credit, which takes some time. Remain diligent in seeking opportunities to establish credit and exercise responsible usage exclusively for purposes of improving your credit score. The more recent positive history that you create helps counter the negative history stemming from the bankruptcy. Those seeking an attorney in Houston County, the Enterprise and Ozark regions, and other Wiregrass cities can contact The Gil Law Firm at (334) 673-0100.