Credit Repair After Bankruptcy

Filing for bankruptcy is a serious decision and there are many consequences that will follow. However, there is life after bankruptcy and ways to improve your damaged credit. By law, you are allowed to challenge items on your credit report that are in error or that you don't agree with. If you challenge these items correctly, the bureaus must investigate and prove their validity. If they cannot, the items in question must be removed. It is amazing how many negative items get removed from consumer credit reports each day because they cannot be verified. Even after a bankruptcy, your credit report can be repaired.

Disputing negative items is only way to repair your credit after bankruptcy. There are several other steps you should take in addition to disputing; they are as follows:

• Pay all of your bills on time: late payments can really damage your credit and can be listed for 7 years.
• Close all unnecessary accounts: Too many trade lines, especially ones that have balances, can hurt your credit. However, be selective as to which ones you close. Older accounts should typically be kept open. Even if you haven't used the account in a while, older accounts demonstrate a longer credit history.
• Hold off on applying for credit: Do not apply for credit while you are trying to repair it. You will not be able to qualify for favorable rates and terms; especially with a bankruptcy. Bankruptcy tells the lender that you are a huge credit risk and if they are going to give you a loan, they are going to charge a lot more in interest to protect themselves. You could also be adding more damaging inquiries to your report.
• Pay off or reduce your credit card balances each month: Do not max out your cards and keep your debt ratio low. It is good to have a wide gap between the credit available to you and what you are actually using. A good rule of thumb is to keep your balances around 30% of your total available limit.
• Let your credit sit: Inactivity can be good. Constant balance transfers and inquiries can negatively affect your score.

The experts at Legacy Legal Services can help you repair your credit after bankruptcy. You need not suffer with tarnished credit for 10, or more, years. We have a thorough knowledge of the laws that can help you get back on track towards healthy credit. Let us help you today.