Filing for bankruptcy and going through the legal process can be a very traumatic time for you and your family. You may wonder if you will ever be able to get credit again. The short answer is yes. The longer reality is that it depends upon you and how you handle your bill paying and financial affairs moving forward. Once the bankruptcy proceedings are completed and the bankruptcy has been discharged it is important to begin rebuilding and re-establishing your credit as soon as possible. Yes, bankruptcy does significantly reduce your credit score, but the hit to your credit does not have to last for the ten years that it takes for the bankruptcy to fall off of your credit report. Keep reading to learn how to get credit after bankruptcy.

A lot of different variables will impact the amount of time that it will take you to rebuild your credit, but there are a few critical steps that if taken and acted upon properly, it will ensure that you move back to a positive credit rating more quickly. It is critical that you get your personal finances in order in all aspects of your life; no matter if you have a significant cash flow each month, or hardly any at all. You must live within your means and put some money into a savings account for extra security in the event of unexpected expenses or an emergency. Now, you could just live on cash, but in order to build your credit score you must use credit and use it wisely. To accomplish this goal you need to embrace and follow good credit habits and pay all of your bills on time. http://articles.moneycentral.msn.com/Banking/BankruptcyGuide/BounceBackFastAfterBankruptcy.aspx http://www.bankrate.com/finance/debt/life-after-bankruptcy-1.aspx

In order to re-establish your credit, the first step is to get your credit reports from the three national credit bureaus; Equifax, Experian and TransUnion. Per the FCRA, or Fair Credit Reporting Act, these national consumer reporting agencies are required by law to provide you with a free annual credit report. They will not automatically send you one each year, you must request your free report from each of the three credit bureaus.

The reason this is an important first step is because many times a consumer's credit report will contain errors and inaccurate negative entries. One potential problem people face when trying to rebound from a bankruptcy is that their credit report may still show open and overdue accounts and remaining debt obligations, even though those accounts and obligations were closed and wiped clean as part of the bankruptcy settlement. Once you receive your credit history reports go through each of them and look for any errors or mistakes that need to be corrected. If you do find any errors, notify the reporting agency and request that it be corrected. Since your credit score is dependent upon any information in your credit reports, it is critical that they not contain any errors. http://www.ftc.gov/os/statutes/fcra.htm http://en.wikipedia.org/wiki/Fair_Credit_Reporting_Act http://en.wikipedia.org/wiki/Consumer_credit_reporting_agency

Once you begin improving the accuracy of your credit reports, and when you have the money to do so, the next step is to get a secured credit card. Contact local banks and credit unions and decide on one card to use. Inquire first at your local credit union, they may offer you a secured credit card with lower fees and interest rates than other credit card providers. With a secured card you will typically have a credit limit that is equal to the amount that you put on deposit with the issuing provider. You could live on a cash-basis only, but in order to reestablish your credit, you must use credit. It is unlikely that immediately coming out of a bankruptcy, you would qualify for any unsecured credit cards, and if you could, the interest rate charged is sure to be extreme. The point here is to start paying yourself first. Instead of paying interest to a credit card company, give that money to yourself and put it into a savings account. It is true that after a bankruptcy you will start receiving credit card offers, but if you start taking the first offers that you receive, you will pay higher fees and interest rates. Wait for six months to a year and the unsecured credit card offers will begin to have better terms. Also, after six months to a year, if you have followed responsible payment habits with your secured credit card, that provider may transition your account to an unsecured credit account. http://www.bankrate.com/finance/credit-cards/10-questions-before-getting-a-secured-credit-card-1.aspx

The third and probably most important step is to embrace and follow good credit habits each and every month for all of your financial and debt responsibilities, not just your credit accounts. If you have any installment loans such as a mortgage or car loan; revolving credit, such as a credit card or equity line of credit remaining on your home that you maintained through the bankruptcy, make sure that these are paid each month on time. The point here is to pay all of your bills on time every month without fail.

So to ensure that you get credit after your bankruptcy sooner, rather than later, follow these important steps: clean up your credit reports to make sure that they are reporting accurate information, get a secured credit card, put some money into a savings account for unforeseen expenses, embrace good credit habits and pay all of your monthly bills on time and you will be well on your way back to a normal credit life. Discipline, persistence and a positive mental attitude will serve you well and can make the difference on your road back to a good credit score and credit rating. http://www.bankrate.com/finance/debt/life-after-bankruptcy-2.aspx