When you go through bankruptcy, you have a fresh financial start to look forward to. While you no longer have crippling debt, there are still some new challenges to be aware of. For starters, filing for bankruptcy will severely impact your credit score.
The good news is that there are ways to address credit repair after bankruptcy in Texas. By taking the right steps, you can rebuild your credit and take advantage of being free from the bills that overwhelmed you in the first place. Our dedicated bankruptcy attorneys could help you understand your options for improving your financial health.
How Does Bankruptcy Negatively Impact Your Credit?
There are some downsides when it comes to filing for protection under the bankruptcy code. You can expect your credit score to be negatively impacted when you file your petition, and it can fall again following your discharge.
Of course, the reality is that most people considering bankruptcy are already facing a low credit score. While no one wants to see that score fall further, the benefits of bankruptcy protections generally outweigh these challenges. By securing a fresh financial start, you are in a better position to improve your credit in the years to come.
The record of your bankruptcy filing can remain on your credit report for some time. Chapter 13 filings will remain on your records for seven years, and Chapter 7 lasts even longer. That said, taking the right steps to repair your credit score following a Texas bankruptcy can leave you on firmer financial ground in the future compared to the status quo.
Important Steps To Rebuild Your Credit Score
While facing a low credit score after bankruptcy is never easy, there are steps that Texas residents who are in this situation can take to improve their credit ratings. This process may take time, but it could potentially enable you to earn a sterling credit score even after a past bankruptcy.
Keep Up With Payments
The most important thing you can do right after your bankruptcy is to keep up with any existing debt payments. These include obligations that survive bankruptcy, such as child support and tax obligations. Your payment history is a big part of your credit score, so making payments consistently will go a long way toward boosting it.
Apply for a Credit Card
It might not be easy to obtain a credit card at first, but keep applying for them and get one if possible. Simply having a credit card is not enough—using it is crucial to building your score. Responsibility is key because the card will help you only if you consistently make your credit card payments on time.
While traditional cards might be hard to obtain, there are options for individuals with poor credit. This type of credit card often involves the use of collateral to guarantee repayment. While this is risky, you should only be making low-cost purchases so you can afford to pay off your credit card bill at the end of each month.
Check Your Credit Report
The best time to check your credit report and review it for accuracy is right after a bankruptcy. Your score could be artificially low because your credit report could still say that your loans are delinquent, although they have been repaid.
When you are trying to rebuild your credit after filing for bankruptcy, you need a trusted attorney by your side.
Call a Texas Attorney To Discuss Raising Your Credit Score After Bankruptcy
Facing a bad credit score can be daunting, but you can take steps to raise it—even after bankruptcy. If you hire Allmand Law Firm, we could help you with every aspect of your bankruptcy, including guiding you on what to do after your debts are discharged. We have considerable experience in assisting our clients with credit repair after bankruptcy in Texas. Call us today to schedule a free case evaluation.
