It's possible to be concerned about your credit rating if you have filed for bankruptcy. Although you can't immediately open a new card, there are still ways to rebuild your credit. You can rebuild credit after bankruptcy, whether you are looking for a new card or to save your house.
Rebuilding your credit score after bankruptcy
If you do the right things, your credit rating will skyrocket after filing for bankruptcy. You must start by paying your monthly bills on time. This is important because your payment history accounts for 35 percent of your FICO score. To improve your score, you must also establish positive financial habits. Avoid charging all of your expenses to credit cards. Instead, pick one bill you can afford to pay in full each month. Once you are comfortable with your new credit account, you can start to move to other accounts.
FICO scores are affected by your credit card debt. A high balance on your credit cards should be reduced. You should also start building an emergency savings account to avoid debt in the future.
After bankruptcy, getting a new credit card
Before you apply after bankruptcy for a credit card, be certain that you have paid off your debts. Bankruptcy can affect your credit score. It may take six months to five year to get your debts discharged. There are two options: chapter 7 bankruptcy or chapter 13. This will wipe out most of your debt. Chapter 13 is also called a wage earner plan, and it requires you to make monthly payments based on your income.
Once you have cleared your debts, you'll need to rebuild your credit score. This is essential if you hope to obtain a mortgage or a car loan. Credit card options are also limited by bankruptcy. It's essential to read the terms and conditions of each card carefully to avoid conditions that will only hurt your credit score.
Saving your home after bankruptcy
It is possible to save your house by refinancing your mortgage after bankruptcy. However, you should be aware of the different options and risks before you make the big decision. First, you should know that you will likely have a difficult time getting a mortgage after bankruptcy. A large amount of home maintenance must be paid, including snow removal, landscaping, pest control, as well as pest control. This can be expensive, but it's essential to plan ahead.
Also, file Chapter 13 bankruptcy for those facing foreclosure. Filing for Chapter 13 will stop collection activity against you while you work on a payment plan.