Strategies To Improve Your Credit Score Post Bankruptcy
Many individuals who file bankruptcy after being riddled with debt for a long period of time have no desire to get credit after being granted a bankruptcy discharge. However, obtaining credit is an important step towards rebuilding your credit score. Luckily, there are strategies through which you can begin creating a favorable credit score without obtaining new credit. Our professionals at ZocLaw.com have compiled six different strategies through which you can improve your credit score without the concern of incurring large amounts of debt.
Open Deposit Accounts
Creditors use bank accounts as an indicator of financial stability and to get an idea of how you will pay your accounts. If you are unable to include a checking account number in your credit application, you will most likely be unable to obtain credit. A money market account or a savings account may also help. Having a savings, checking, or a money marketing account makes creditors feel confident in their decision to grant you credit. It shows them that you are making an effort to build up savings. Furthermore, if in the unfortunate event that they have to sue to collect, they have a source from which to collect their judgment. You shouldn’t be denied a bank account simply because you have a bad credit history. However, a bad check-writing record may result in the denial of a new bank account. Most banks will verify your check writing history before opening an account for you. If you are successful in opening up a checking account, ensure that there are sufficient funds available before writing out checks. “Check 21,” a newly instated federal law permits banks to process electronic images of checks, instead of paper originals. This allows the checks to be either cleared or bounced faster. To avoid your check from bouncing, ensure that there are sufficient funds are available before writing a check.
Use Credit Cards Wisely
Once you have received your bankruptcy discharge and if you were able to still hold on to one of your old credit or charge cards, use it to pay off bills. This can help you increase your credit score provided that you charge amounts and pay them off in full and on time.
Build Credit In Your Own Name
If most of your credit is on your spouse’s or ex-spouse’s name only, it is important to get credit in your name too. Obtaining credit on your own name is a great way repair your credit if:
- The majority of your financial problems can be attributed to your wife.
- You and your spouse have endured financially difficulty together, but most of the credit was on your spouse’s name.
Update your credit history to include all accounts
If you have been through a divorce, or if you are separated and most of the credit has been on your spouse’s name, you may not have a history of good credit in your report. A good starting point is ensuring that all accounts and joint accounts in which you were obligated to make payments towards appear on your report, particularly if they were in good standing.
Ask creditors to factor in your spouse’s credit history
When you apply for a credit card, loan or any other type of credit you may request to take into consideration your spouse’s credit history that reflects well on your credit worthiness as well.
Ask a creditor not to consider your spouse’s credit score
If in the unfortunate event that your spouse caused credit problems on joint accounts, you can present this information to a potential creditor to indicate why the account is not an accurate reflection of your creditworthiness.