Reestablishing Your Credit After Filing for Bankruptcy Protection

A Bankruptcy Petition Won’t Permanently Ruin Your Credit Rating

If you’re struggling to meet financial obligations because you’ve lost your job, had unanticipated and unreimbursed medical expenses, or any other reason, American bankruptcy law is there to help. You may be reluctant to exercise your rights for fear of permanently damaging your credit. Though there’s no way to avoid an immediate and significant impact on your credit score, the effect can be relatively temporary, provided you take the right steps.

The first thing to understand is that your credit score, while almost always a factor in a lender’s decision-making, is often only one of a number of criteria used to determine your eligibility for a loan. If you can show a lender that the factors leading to your bankruptcy were unforeseeable and uncharacteristic, you may qualify. For example, it will help if you can show you consistently paid all bills in a timely manner before the circumstances that led to bankruptcy.

In addition, a lender is likely to look at what you’ve done since filing for bankruptcy. Have you honored all the terms of your bankruptcy? Have you refrained from unnecessary purchases? Are you paying bills in a timely manner now?

There also are steps you can take to rebuild your credit:

• Get a copy of your credit report on a regular basis to make sure that creditors properly report your payments and no late payments are inaccurately reflected.
• Apply for a secured credit card (where you put money down as collateral), use it sparingly, and ask the credit card company to report all use to the credit reporting agencies.
• Keep existing accounts open. As a general rule, closing existing accounts will lower your credit score.
• After you’ve honored all commitments for 18-24 months, apply for a small loan. If you get the loan, make payments in a timely manner.

Contact an Experienced Rockwall, Texas, Bankruptcy Attorney

At the Law Offices of Carrie Weir, all potential clients are entitled to a free initial consultation. I am currently communicating with clients by phone, text message, and videoconference. To arrange an appointment, contact my office online or call 972-772-3083. I handle personal bankruptcy filings throughout Rockwall County, Texas, including the cities of Rockwall, Heath, Greenville, Lavon, Wylie, Mesquite, and Rowlett.