Everyone knows that bankruptcy will have a negative impact on credit scores. The simple fact is, any time that debts go unpaid; there is a negative impact on credit scores. Bankruptcy is the process by which a Houston bankruptcy lawyer helps to alleviate consumers of debt related stress on the basis of financial hardship. Therefore, these consumers are not paying their debts off which will have a negative impact on credit scores. But, how bad does bankruptcy really hurt your credit score?
Well, if you search online you will find several answers to this question. Some writers may say that the process takes as little as a few months while others say it could take 7 to 10 years. Of course if you talk to a Houston bankruptcy attorney they will tell you that you’re not going to improve your credit score in just a few months after bankruptcy, but it shouldn’t take 7 to 10 years either. The truth is the amount of time that it takes to improve your credit score is completely up to you. The more diligent you are in the process, the faster you’ll be able to improve your score. That being said, here are a few things that you can do to improve your credit score after bankruptcy.
Step #1: Ask Your Bankruptcy Attorney for Guidance – Houston bankruptcy attorneys are experts in bankruptcy and often times credit scores, reports and other debt related matters. That being said, after a bankruptcy, it’s best to consult with your bankruptcy attorney for guidance on how to improve your credit score once your bankruptcy has been finalized. Follow every step that they provide. Their steps may include some of the following steps provided in this article.
Step #2: Get A Secured Credit Card – Your credit score is based on previous debts. A Big piece of it is based on how you handle revolving credit. By using a secured credit card properly, the bad credit caused by your bankruptcy will slowly be cured. However, to use your secured credit card, you’re going to have to make a security deposit. This alleviates the lender of risks associated with loaning money to consumers with poor credit scores. So, get your secured card, make your security deposit and responsibly use your credit card.
Step #3: Pay Your Bills on Time – Although everyone knows that it’s important to pay your bills on time, not everyone realizes just how important it is. Every time you make a late payment, your credit score is dinged. After too many of these dings, you will have incredibly bad credit. Because you already have bad credit as a result of your bankruptcy, you want to make sure to pay all your bills on time. As you do his, your credit report continues to get more and more positive information about how you handle your debts.
If you follow all of these steps, you could be on the road to good credit scores in 3 years!
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