After you complete the bankruptcy process, how do you begin rebuilding good credit? It is not as difficult as you might think, but bankruptcy lawyers know it requires planning and dedication. Here are a few steps you can take to get back on a solid financial foundation.

Improve Your Credit Score After Bankruptcy With These Tips

Make a Budget

Bankruptcy lawyers know careful planning for a financial comeback begins with an honest budget. Write down all your income and expenses, and craft a conservative strategy you can live with. Put at least $100 per month in a saving account and work toward building three to six months’ worth of your net income to cover emergencies.

Pay Your Bills on Time

Make rent or mortgage and utility payments on time. Ask your landlord to report your payments to all three credit reporting agencies — Experian®, Equifax®, and TransUnion®. Order copies of the three reports to ensure balances are zeroed out as discharged, and reach out to your bankruptcy lawyer if you have questions. Obtain your free copy each year afterward to check for errors or omissions.

Get a Secured Credit Card

After you build up a few hundred dollars in your savings account, ask your bank or credit union for a secured credit card. The card and credit limit are backed by your deposit amount. Make small purchases of things you need, and avoid impulse buying of unnecessary items. Pay off the balance in full each month, and check that your account is reported to the credit bureaus. In about 12 months, you should qualify for an unsecured card and see improvement in your credit score.

Reaffirm Secured Debt that you are keeping (Chapter 7)

In a Chapter 7 Bankruptcy, if you have a house with a mortgage and / or a car that you are making payments on, and plan on keeping after the bankruptcy, it may be a good idea to actually sign a reaffirmation agreement.  Many creditors will not post anything (even good payments) to your credit report after a bankruptcy is filed.  However, if a reaffirmation agreement is signed, many creditors will begin to post again.  The downside is that a reaffirmation agreement makes the debt non-dischargeable, so if payments aren’t made, you are still personally liable for the debt.  Talk to you bankruptcy lawyer (hopefully me) to go over the pros and cons.

If you need a bankruptcy lawyer in Clermont County, OH, turn to the Swartz Law Office in Batavia. Attorney and founder Donald K. Swartz offers over 20 years of experience in Ohio and Kentucky and will guide you through your financial problems with skill and compassion. For mortgage help, wills, and estate planning, make a consultation appointment by visiting his website or calling his office at (513) 732-0900 today.