Utilize Secured Credit Cards to Improve Credit
Do not even entertain the idea of obtaining credit cards immediately following a bankruptcy, as all issuers would reject your application. While you may not qualify for unsecured revolving credit lines, the majority of banks will eagerly issue you a secured credit card. The operation of secured credit cards is straightforward: you establish a savings account with your credit card issuer, where funds are held in escrow, and you receive a credit card with a credit limit equal to the amount of your security deposit. The reporting of secured credit cards to credit bureaus is identical to that of traditional credit cards. Due to the fact that credit card debt accounts for 35% of your credit score, opening a few secured credit cards could significantly increase your credit score within a few months.
Exhibit Responsible Banking Conduct
In addition to opening secured credit card accounts, it is advised to exhibit responsible banking behavior. Ensure that you have both a checking and a savings account, and contribute a small portion of each paycheck to savings. Banks adore savers because they are typically more responsible and exhibit a lower risk of loan default. Additionally, setting aside a portion of each paycheck would help you create an emergency fund for unforeseen expenses. Obviously, you should not void checks or exceed your available checking account balance, as doing so is a clear indication to lenders that your finances are in disarray.
First, apply for small loans.
No one will lend you a substantial sum of money immediately following bankruptcy. However, few lenders will typically entrust you with quantities between $500 and $5,000. Although the interest rates and terms of loans for newly discharged bankrupts are unfavorable, these loans provide an excellent opportunity to demonstrate that you have learned your lesson and are responsible with obtaining money. Additionally, personal loans are reported to credit bureaus, enhancing your credit score and reestablishing your credit history.
Use a Cosigner
If you can ask a family member or close acquaintance to serve as a guarantor for your loan, you should take advantage of the opportunity. Using a cosigner not only increases your chances of obtaining a loan, but it also saves you a substantial amount of money, as cosigned loans have reduced interest rates and fees. Before taking out a cosigned loan, you should always ensure that you will be able to repay it on time, as failure to do so would make your cosigner responsible for repaying the loan.
Some borrowers may have trouble obtaining loans from traditional institutions, such as banks, credit unions, and credit card companies, despite adhering to all of the aforementioned guidelines for improving credit score. The best way to obtain a loan after a bankruptcy is to utilize the services of nontraditional online lenders, as they have less stringent application requirements and are able to approve individuals with significant credit issues.""
" - https://www.affordablecebu.com/
