Tips for Healthy Credit After Bankruptcy
So I’ve filed for bankruptcy, now what?
I’ve heard from several people who have filed for bankruptcy protection that once they have successfully filed the last thing they want to do is deal with their finances. At this moment, the best thing a person can do is place their finances near the top of their priority list once a bankruptcy has been filed.
After all, the fresh start that many attorneys promise isn’t always easy to achieve for many recent bankruptcy filers. Here are a few steps that can be taken to get finances and credit back on track:
Create a budget with a Nonprofit Credit Counselor
I recommend that even after they file for bankruptcy that individuals still seek budgeting guidance from a credit counseling organization. This is typically a free service that is developed to help people budget their daily finances; this can be of great help once a bankruptcy has been filed by providing valuable insight on how to prevent these problems in the future.
If a credit counseling agency charges for this service I recommend that you look again until you find help elsewhere. There are several well-qualified agencies that offer no-cost counseling.
Avoid Expensive Credit Offers
Good credit will be difficult to come by, period. There is a difference between good credit, which offers lower interest rates, no maintenance fees, etc. versus poor or risky credit that is offered to individuals who have a shaky credit history.
Be careful in deciding who to look for when seeking lines of credit, auto purchases, etc. Read all of the fine print and understand that if you borrow x amount of dollars it will actually cost you x amount in the long run.
Build a Savings Fund for Big Purchases and Emergencies
Save from the start. Don’t rely on getting a loan, it can prove to be risky and extremely costly as there are several organizations that love the fact that they can justify higher rates based on your poor credit. Talk to an agency about your budget and then start to save for those rainy day emergencies, such as a vehicle repair, vet bills, etc. The more you save, the less you will have to rely on a poor loan that will cost you in the end.
Begin Rebuilding Credit
No matter how you go about it, rebuilding your credit will take time. As mentioned, any credit offered after your bankruptcy will likely come at a high price. For fair terms, you may need to turn to alternatives tools and resources. Take a look at our Education Manager’s article (summary video included) on improving your credit rating for ideas on how to get started:
Keep Moving Forward
Bankruptcy is an emotionally trying experience for anyone who treads through it. Be diligent in taking the steps necessary to turn your finances back around and you’ll ensure that this chapter is put behind you.
Do You Have Questions About Establishing Healthy Credit After Bankruptcy?
Comment Below and We’ll Answer as Fast as We Can!
We routinely check our articles and blog posts for new comments and make it a priority to respond quickly.
If you need more information on caring for your credit after filing for bankruptcy or have any other questions about improving your personal finances, please feel free to comment below and we’ll answer as right away!