How long will Bankruptcy affect my credit?

A common question I have from clients is how long it will take them to get their credit back to normal levels post- Bankruptcy.  Initially, your credit score will drop significantly when filing for Bankruptcy.  However, for most clients that would have been the case regardless of whether or not they actually filed for Bankruptcy, as their unpaid credit cards/judgments would have lowered their credit score even without any Bankruptcy action.  Bankruptcy basically wipes the slate clean and takes your credit score down BUT it also allows you to wipe off those unpaid credit cards and judgments so you can start to SLOWLY and correctly re-build your credit again.  As to how long it will take you to get credit cards after you’ve filed for Bankruptcy,  the answer ranges but you should  begin to receive credit card offers within the first year or year and a half after filing for Bankruptcy.  I’ve even had some clients who have had credit card offers only 6 months after filing for Bankruptcy.

The best thing you can do is to borrow responsibly, if you do decide to borrow.  Show lenders that you’ve had some issues in the past but have gotten through them and now you can handle and manage any debt that you may have.  Perhaps the easiest way to do this is to apply for a secured credit card.  Its almost the same thing as a gift card.  You give the card issues $500, and they issue you a credit card with a limit of $500.  Just be careful and watch out for any high fees, etc.  Bankrate.com has a great database which lists the fees/expenses of many of these secured credit cards.

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