Bankruptcy can be a very painful time for anyone. However, bankruptcy surely doesn't mean it's the end of the world for you. While bankruptcy can have a major effect on your credit score, it won't mean that you'll never be able to avail of credit again. While the recovery process may be quite long and stressful, and sometimes you’ll only be left with nothing with your shirt on your back, or your pants and shoes, there is always light at the end of the dark tunnel. Here are five innovative ways for rebuilding your credit after being bankrupt. Get A Secured Credit Card Once your bankruptcy has already been discharged, slowly build back your credit, by getting a secured or prepaid credit card. A prepaid credit card can act like a debit card, where you put in cash, and you draw against it, and you reload the card again. Always make it a habit to not use more than 40 percent of your credit limit on any revolving loan. Pay All Your Bills On Time To build up your credit score after bankruptcy, remember to pay all of your bills on time. From credit card, telephone and utility bills, to apartment rentals and even parking ticket fines, always ensure that you're not weighed down by too much debt. Some creditors have been known to look at their customer's bill payment records, so that they can establish your willingness to pay. Get Installment Loans Next, get an installment loan, such as a car or appliance loan. This can be a nice start towards rebuilding your credit score. Once you've gotten approval, pay off the loan in the quickest time possible. Evaluate Your Credit Report For Errors Your credit report must still need to be fully evaluated, even if you've already been declared to be bankrupt. Check out any errors or inconsistencies on your credit report, because any negative item is only allowed to be reported for 7 years. Should you spot any inconsistency or discrepancy in your report, this should be removed or erased immediately. Keep Off Any Overdraft Fees To steer clear of overdraft fees, always make it a habit to balance your checkbook against your monthly statements, and always keep records of the items you purchase, or the services you’ve availed of. It would also help if you say no to having a “co-signer” to your credit. By having co-signers show-up on your credit report, it may actually weaken your case with future creditors. Once a creditor sees that you’ve had a co-signer, they’ll see you as a high-risk client, and will also ask that you get a co-signer for their loan too. These times, a person’s financial future greatly revolves around those three little numbers that make up a credit report. A good score indicates that you are financially stable, and is in good standing for applying a loan, or any form of financing. A low or poor credit score will only serve to add more headaches to your financial standing.
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