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Beginning your life after bankruptcy can sometimes seem a little daunting, but you will be surprised that you are in a much better situation then you might imagine. The important thing that you need to do after bankruptcy is rebuilding your credit and install back your good credit score into your credit report.
Two years after a bankruptcy discharge, debtors are eligible for mortgage loans on terms as good as those of others, with the same financial profile who has not filed bankruptcy. The size of your down payment and the stability of your income will be much more important than the fact you filed bankruptcy in the past.
Although bankruptcy has many undesirable consequences such as your bad credit record will remain on your credit report for 7-10 years, but with a little work, you can improve your credit even before these negative records expire. Here are five easy steps you can take to rebuild your credit:
Step 1: Current credit status
The first step to rebuilding your credit is to look at exactly where you stand. Order all your three credit reports from those three national credit bureaus: TransUnion, Equifax, and Experian. You can order these reports online, it easy and secure.
Step 2: Check the expiration dates
By law, your bad credit record will remain in your credit report for 7 to 10 years, but the exact expiry date might be different among these 3 reports. Look up the exact date of each of bad records including judgments, liens, charge-offs, late payments, bankruptcy filings, and collection records.
Step 3: Request For Correct On Any Inaccurate Records
If you find inaccurate records, fraudulent accounts, or records that should have expired on you credit reports, you have the right to send a separate dispute letter to each of the credit bureaus to correct your Equifax, Experian, and TransUnion records.
Step 4: Start to create good credits
Since there is no way to remove your bad record from your credit report, the best way to improve your credit score is to add good credits and building up your credit from there. Use this new credit card responsibly and make the monthly payment timely; with this you are building new history of good credit behavior on your credit report.
Step 5: Monitor your progress
Subscribe to a credit card monitoring service or get a credit card monitoring software and use it to track your credit score progress closely. Your credit score should improve steadily as you continue to use credit responsibly and add new positive information to your credit reports.
A life in bankruptcy is not an unbearable phase if you look at it from a positive angle. As the saying goes, "Time heal all wounds." It will take years to be a 'normal' person again, but once you know you have attained the discipline to practice good habits, there's no reason how you can fall back to the old self. As you become wiser, you can better inform others about the unhealthy influences of commercialism and consumerism.
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