Obtaining credit after bankruptcy is straightforward with a secured credit card.
"People in dire financial straits are sometimes left with no choice but to file for bankruptcy, despite the fact that the vast majority despise the idea. Bills may no longer be a source of stress after a bankruptcy discharge, but a new form of stress will emerge. This is the anxiety associated with being denied financing and lending of any kind. Nonetheless, there is an easy-to-obtain form of credit that few people are aware of, and it can help you reestablish yourself quickly.
How to Obtain Credit Following Bankruptcy
When applying for credit after bankruptcy, the first step is to register for a secured credit card. A secured credit card is supported by a cash deposit made with the card issuer. If you fail to make the payments, they will withdraw the funds from your account, removing any risk on their part. The benefit of secured credit cards is that the credit reporting agencies have no way of knowing that the account is secured, so it will be assessed the same as a standard credit card.
The same rules apply when using secured credit cards to open accounts after bankruptcy. You must maintain a balance-to-limit ratio of less than 50 percent, or your credit score could be negatively impacted. Even if the card is secured by cash, late payments will still be reported to the credit bureaus, lowering your score further. Many companies will convert the card to a standard unsecured account after a period of timely payments and may even increase the card's limit.
It is simple to reestablish your FICO score with these types of accounts after a bankruptcy. After six to twelve months, many creditors will gladly extend you credit based on your prompt payments to your secured account.""
" - https://www.affordablecebu.com/
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"Obtaining credit after bankruptcy is straightforward with a secured credit card."
was written by Mary
under the Finance / Wealth
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comments. The article was created on 03 June 2023
and updated on 03 June 2023