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Helping good people through bad times

Life after bankruptcy is not only possible it is probable

Filing for bankruptcy can be a frightening prospect. Most of this, however, is based on fear of the unknown rather than reality. For consumers struggling with financial challenges and seeking to eliminate debt the benefits of bankruptcy far outweigh the negatives. Further, consumers can begin to rebuild their credit score almost immediately. Tennessee consumers considering bankruptcy might be interested in learning more about rebuilding credit.

Many people who could truly benefit from filing for bankruptcy often put it off thereby prolonging their misery and subjecting themselves to unnecessary stress because they are worried about damaging their credit score and foregoing future opportunities, such as the opportunity to purchase a home. While a dented credit score does affect interest rates and things such as insurance payments, it is possible to start rebuilding your score immediately.

The first thing that consumers who have filed for personal bankruptcy needs to do to rebuild their credit is to request a secured credit card from their financial institution. A secured card is a card backed by a deposit made by the cardholder. For example, if the creditor deposits $500 that becomes their credit limit. It is important that the consumer order a secured card rather than a prepaid card because a prepaid card is not reported to credit score bureaus.

As a consumers credit score begins to rebuild over time the borrower should begin to use retail credit cards or gas cards. Consumers can use these cards for ordinary purchases paying them off each month.

Remember that it is important to make payments promptly. One-way to do this is to establish a direct payment from a checking or savings account. Even with the initial dent, a fresh start and a strategy is all it takes to get back on track.

Source: Fox Business, "How to Rebuild Your Credit After Filing for Bankruptcy," Roman Shteyn, March 05, 2013

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Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-624-4002
Toll Free: 800-257-7594
Fax: 423-624-0509
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