Tips for Life After Bankruptcy

After you have filed bankruptcy, using credit wisely is essential to building and maintaining your credit score and your overall creditworthiness. It is important to keep all of your lines of credit in good standing so that you can eventually apply for more credit, to increase and repair your credit score.

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Here are a few general guidelines to follow when using your credit after you have recently filed bankruptcy.

Use cash when possible. Only use your credit cards when cash isn’t an acceptable form of payment, such as car rentals, plane reservations and hotel rooms. It would be all too easy to spend on your credit cards, which will not help your situation after bankruptcy.

Pay the total balance on your cards each month and pay your bills on time. This is your chance to improve and enjoy your credit.

If you have a balance on your cards, keep the balance low. If you are making purchases that require you to keep a balance on your cards, make sure the balance is less than half of your available credit. If you balance rises to the limit, you credit score may decrease.

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Pay your mortgage above all else. Never allow yourself to pay your mortgage late. Keep your payments in good standing in order to keep your home and your financial freedom.

Creditors use credit reports to decide whether to extend credit. Request a copy of your credit report on a regular basis from a credit reporting agency and review it for accuracy. Be sure to dispute any inaccuracies that are on your report. Also, be sure that your credit report stays current and reflects accounts that are in good standing. Bankruptcy stays on the credit bureau report for 10 years.

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