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What can you do to rebuild credit after bankruptcy?

On Behalf of | Jul 23, 2018 | Chapter 7 Bankruptcy |

If you are a Tennessee resident who has filed for bankruptcy, you may be working to rebuild your credit in the aftermath of your filing. While, initially, you may find that you have a harder time obtaining credit, you can typically slowly build it back up by paying higher interest rates than you might, had you not filed for bankruptcy. Building your credit back up is an important and necessary step, however, if you wish to obtain any new loans moving forward, and there are certain steps you can take that may streamline the process.

According to Bankrate, in some cases, recognizing what not to do when rebuilding your credit is as important as recognizing what steps may help you through the process. For example, you may want to think twice before signing on with a for-profit company that bills itself a credit repair agency. Why? Unfortunately, many such companies are unethical, and they may tell you lies about what they can do for you when, in actuality, they probably cannot do anything for you that you could not do for yourself.

What you may want to consider when starting to rebuild your credit is opening up a secured credit card account. Once you make a deposit into such an account, you will typically receive a smaller extension of credit you can then use to start rebuilding your credit. If you see gradual increases in the amount of credit made available to you, this, too, should help boost your credit score. Buying a car may, too, help you begin to rebuild your credit, but whether you can do so typically depends on certain factors, such as the type of bankruptcy filing you had, and how long ago you filed for it.

This information is educational in nature and does not constitute legal advice.