How to Repair Credit After Bankruptcy

by Contributor ; Updated July 27, 2017
Repair Credit After Bankruptcy

How to Repair Credit After Bankruptcy. Repairing your credit after a bankruptcy can be hard, but it can be done. Your focus should be on gaining positive accounts on your credit report that will "age" as your bankruptcy does. So, while your bankruptcy gets further into the past, your good accounts get older as well and you will have positive, recent credit history built up. It is important to remember to wait to get new credit until your situation (the one that caused you to file for bankruptcy) has changed.

Step 1

Get a secured card. With this kind of card, you will send the company a deposit and they will send you a card with your deposit amount as the credit limit. The card will work like any other credit card and you will receive your deposit back (assuming you don't default) when you have build enough history with the company.

Step 2

Apply for a store card. These can be easier to get than regular credit cards, so it is your best bet after having a secured card or two for about a year. If you cannot get approved for a store card, then you are probably not ready to apply for an unsecured credit card after your bankruptcy.

Step 3

See about qualifying for a car loan or small personal loan to repair your credit. With the way FICO scoring is set up, you need variety on your credit report. Besides positive revolving accounts, you also need some positive installment accounts. A car loan or small personal loan will be easiest to qualify for.

Step 4

Try for a credit card. Once you have successfully established history with a secured card, store card, and installment account, you are ready for the big leagues. This is the best time to apply for an unsecured Visa, Mastercard, Discover or American Express credit card. If you are denied, let your accounts age for another six months and try again. Before you know it, your bankruptcy will be a distant memory.

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