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How can you rebuild your credit after bankruptcy?

On Behalf of | Apr 7, 2021 | Personal Bankruptcy |

After the finalization of your bankruptcy, your credit score drops. If you are like most people, you probably worry about how you can build your credit again. Your lowered credit score does not last forever.

The Huffington Post describes steps you can follow to rebuild your credit score.

Search for errors

After bankruptcy, you can receive a credit report. There are three credit reporting agencies that you should receive the reports from Experian, TransUnion and Equifax.

Once you receive the report, check for any inconsistencies. If there is any inaccurate information on the reports, then you need to communicate with the institution responsible as soon as possible. Generally, the lender or financial institution can fix the issue.

Rebuild your credit

If you built up your credit score once before, you already know the steps you need to take. Eventually, you will be able to apply for a credit card again. When you apply for a new credit card, make sure that your utilization remains low. Try to pay your statement balance every month. The more often you pay off your credit card, the more likely you will build your credit quickly.

If you still cannot apply for a credit card, you can apply for a secured credit card. Secured credit cards require a deposit. The deposit becomes your credit limit. For lenders, secured credit cards are a safer and low-risk option if you have poor credit.

When you want to rebuild your credit, monitor your score often. Monitoring your score will tell you whether you are on the right track to rebuilding your credit. It can also help you pinpoint any errors in your report.

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