There is always one consistent question asked during every bankruptcy consultation. “ Will I ever be able to get credit again after the filing? ” The answer to this question is pretty simple: “Well it depends.” Credit worthiness is based in some regard on income. So if you have a job and are making money then chances are you will be eligible for future credit. Credit availability is also based upon one’s credit score. A bankruptcy filing adversely affects a person’s credit score. But, there are some proven methods to help dramatically improve credit score after a bankruptcy filing. Your credit score will not improve if the credit reports are not updated to properly reflect the bankruptcy filing. Once your bankruptcy case has been closed and discharged, it is important for you to obtain copies of your 3 credit reports. I always recommend that my Rhode Island and or Massachusetts bankruptcy clients utilize the free website annualcreditreport.com to obtain their Transunion, Experian and Equifax complete credit reports. Getting the individual credit reports rather than a combined report ( which as all three reports merged into one document) is recommended. You need to review the reports to make sure that all the trade lines in the credit reports are accurately reflecting the status of the former obligations that were discharged in bankruptcy. Many credit bureaus make mistakes in the reporting of the bankruptcy filing which cause credit scores to remain low post bankruptcy. Check to see that the credit reports are showing that the balances due each creditor are ZERO and reflecting that the account was included in a prior bankruptcy. If the reports are not correct then you need to get them updated. Once you know that your credit reports are accurate about the bankruptcy filing, only then can you start the process of rebuilding your credit.
A friend of mine used to work at a credit reporting agency in Arizona but died unexpectedly. He taught me a lot about credit scoring modules in the post bankruptcy arena. The bottom line to improving credit score is to open up a few accounts post bankruptcy. There are many credit card companies that will give you a credit card provided you open up a savings account with the company. For example, you deposit $500.00 into a savings account and the company will give you a credit card account with a $500.00 limit. These type of arrangements are known as secured credit card accounts. I suggest that you open two of these accounts. Use one to charge groceries and household expenses, and the other for gas and auto repairs. Always keep a small balance on these accounts and most importantly make sure the minimum payments are made on time. These small accounts if used correctly will help your credit score dramatically improve. Yes, there is credit life after a bankruptcy filing!
Christopher M. Lefebvre Esquire Pawtucket Rhode Island