You filed for bankruptcy; now mend that wounded credit score

On behalf of The Rollins Law Firm posted in Personal Bankruptcy on Wednesday, November 12, 2014.

It’s no secret that a bankruptcy filer’s credit score takes a hit.

And it’s no secret that the so-called FICO scores of filers in Mississippi and elsewhere across the country can rebound sharply from downward spikes in the months and years following bankruptcy, provided that they take purposeful steps to rebuild their credit histories.

A recent article detailing some of those steps reminds filers of Chapter 7 and Chapter 13 bankruptcy that they can take a proactive stance in rebuilding credit by focusing on a few core considerations.

One of those is focusing strongly on taking care of recurring payment obligations – the mortgage, a car loan, the utilities – on time and in full. Another is careful calculation regarding how to use credit cards in a manner that impresses credit reporting agencies. Using a secured credit card for a limited amount of purchases each month that are fully repaid, notes the above-cited article, is “one of the easiest ways to build credit and improve credit scores.” So, too, is opening a new bank account and automatically paying bills online.

Bankruptcy filers need to maintain a realistic perspective as they go through the bankruptcy process and see their credit history take a beating. That downward spike is inevitable, and it is best to simply note that, assess the damage and then begin working proactively and responsibly to repair it.

And it can be repaired. As millions of filers note in the wake of bankruptcy, faithfully following good financial habits results in a progressive and steady uptick in their credit scores.

That is what a Chapter 7 or Chapter 13 filing is all about – a fresh financial start.

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