While a Bankruptcy helps you manage your financial crisis better and start afresh with a clean slate, it also damages your Credit score greatly. However, this does not imply that your finances have been ruined forever. Nor does it mean that you will never be able to procure any credit in the future. Modifying your financial habits a little and handling your credit responsibly are ways of repairing credit after bankruptcy.

Repairing credit after bankruptcy

The first and foremost step towards repairing your credit after bankruptcy is reviewing your credit report. Analyze your current situation with an open mind. You must know exactly where you stand and where you wish to go. You can obtain copies of your credit report from any of the three major bureaus. If you spot any errors, dispute them and get them fixed.

Once you have discharged all your debts under bankruptcy, you might want to apply for fresh credit to rebuild your credit rating. There are tons of lending agencies that offer low limit credit cards to people who have just suffered a bankruptcy. However, these credit cards often come with a hefty annual fee and rate of interest. You can also go for credit cards that are backed by the funds deposited in their account.

Create a budget to handle your finances in a better way. Keep a log of your monthly income and expenses. Then, ensure that you steer clear of the habit of spending more than you can afford. This will stabilize your finances and help minimize your debts. Also, borrow only as much as you can afford to borrow. For instance, if you are well aware that you cannot afford a trip to Paris on your current budget, it is only smart to not get caught in the temptation of using your credit card for the purpose.

If you are considering bankruptcy or just exiting bankruptcy, your Sacramento bankruptcy attorney can help you rebuild your credit profile.

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