Here are three “Building Credit After Bankruptcy” strategies you can use to increase your chances of being approved for auto loans, credit cards, and home loans if you have a bankruptcy on your credit report:
Building Credit After Bankruptcy Strategy #1
Apply for credit where you have a high probability of getting approved, and make the payments on time. Sounds simple, but most people go about applying for credit the WRONG way and make it more difficult than it needs to be.
By the way, don’t go overboard when applying for credit. The whole purpose of getting a credit card or loan is to rebuild your credit history after bankruptcy – not to get in to debt up to your ears!
Be careful about the inquiries. When it comes to some types of inquiries, too many can hurt your credit score. Other types don’t matter.
Building Credit After Bankruptcy Strategy #2
Another way to rebuild your credit after bankruptcy (one my favorite) is to add years of positive credit history to account. You can literally add a number of new positive items to credit your report. It’s 100% legal but the technique is not widely known. When it comes to building credit after bankruptcy, this is a strategy you will want to consider. I don’t have enough room to go into detail on it here, so I’ll save it for another article.
Building Credit After Bankruptcy Strategy #3
Of course, cleaning up inaccurate and obsolete negative information on your credit reports is critical when building credit after a bankruptcy. And you don’t need to use a credit repair company to do it. You can do it yourself and save a few hundred dollars. Just remember that you need to know exactly what to do.
For example, there are three ways to dispute information on your credit report. If you want to correct errors on your report FAST then there’s a certain way you need to request your reports.
Here’s another example: There may be some collection accounts or charge offs on your credit report that don’t belong there. You need to know what to look for to determine if that’s the case or not – and how to dispute such an item if it is. Most people would look at these items and not even realize they don’t belong there.
Remember: When it comes to building credit after bankruptcy you don’t want any inaccurate or obsolete information on your credit report!
I can keep going but I think you get the idea. There are a number of pieces you need to pull together when you are rebuilding your credit after bankruptcy. But it’s worth it. After all, if you can increase your credit score, and building credit after bankruptcy plays a key role, then you could literally save up to hundreds or even thousands of dollars in extra interest and other finance charges when it comes to future loans and lines of credit.
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