Consumers who have struggled with serious debt may often worry that any hope for a positive financial future no longer exists for them. However, that need not be the case.
Even after experiencing a challenging financial situation, including filing for bankruptcy, it is possible to establish a robust credit score and history with the right effort.
Taking a phased approach
As explained by NerdWallet, the impact of a bankruptcy on a person’s credit report may last several years, making it difficult to get the best credit options initially. For this reason, consumers fresh out of bankruptcy should consider taking a phased approach to rebuilding their credit. For some people, this may start with obtaining a secured credit card.
With a secured credit account, a consumer fronts the money to the creditor and uses the credit against that amount. Regular use of the card with prompt repayment in full each billing cycle helps boost credit scores and pave the way for approval of an unsecured credit card.
Another option used by some consumers is having another party, such as a family member, co-sign on a credit account with them. Again, regular use of the account and on-time payments go a long way toward building positive credit.
Monitoring credit reports
According to CreditCards.com, consumers should carefully review their credit reports, scanning them for errors. Any errors should be promptly addressed and corrected. From there, debtors should make it a point to regularly track their credit reports to keep tabs on their credit rebuilding efforts as well as to catch any new errors in a timely fashion.