Credit Repair After Bankruptcy
If you have filed bankruptcy you should expect your credit will be severely damaged. However there is hope, you can take action to remove your bad credit and by building some positive credit you can have a high score.
There is a lot of inaccurate information that claims a bankruptcy will be on your report for 10 years. This is not true you can remove it without waiting 10 long years. We suggest that you:
1. Dispute the mark with each bureau.
You can do this yourself or hire a credit repair service to dispute the mark on your behalf. Did you know that the bureaus do not check public records when they investigate an item? Public records are where this mark is recorded and where the bureau would find verification.
The Fair Credit Reporting Act says that a listing that in not verified must be removed from your report. Additionally this act says that you can dispute any item you feel is inaccurate on your report. It is a common concern about the legality of repairing your credit; you will never have any legal consequence for disputing a listing.
Before you dispute the bankruptcy it is a good idea to make sure that all other negative marks read “included in bankruptcy.” The reason is once the initial bankruptcy mark is removed you will dispute all the other negative items because you do not have a bankruptcy mark on your report. There are rumors that it is much easier to remove this mark after two years.
2. Dispute each negative item.
This can be done because no where on your credit report does it say you have filed a bankruptcy so how can these negative items be included? Upon an investigation the marks should be erased and this will provide you with a clean report.
3. Build positive credit.
This will help the most if you have a new revolving line of credit such as a credit card. By making your on time monthly payments you will create a positive payment history.
Additionally keep your monthly balance at 25% of your available limit because this will show the bureaus that you do use your card and use it responsibly. This will improve your ratio of available credit to debt, a very important factor when your score is calculated.
It might not be the most ethical to dispute items you know are accurate on your report. However is it ethical for lender to charge you 30% interest rate for missing a payment, no matter how long you have been a model customer?
In sum you can remove a bankruptcy and all the negative marks on your credit report. This will improve your credit score and improve your quality of life by; lower interest rates, more purchasing power, and extra money.
Matt Douglas
http://www.articlesbase.com/credit-articles/credit-repair-after-bankruptcy-705779.html
5 comments Click to reply »
What is the best way to repair credit after bankruptcy?
My bankruptcy was discharged in 2004 and I have not applied for a credit card until very recently (Secured Master Card with Capitol One).
I am planning to buy a house in the near future, what are some good ways to build some serious credit fast!
I also have $5000 available to invest into savings, GIC’s etc.
I would try to build up good credit with a local bank. By taking out smallish loans and paying them back. You can use the 5000 dollars as collateral.
References :
Well you should have got that credit card back in 2004 when you BK discharged and you would not be asking this question.
It takes 24-months of good payment history to qualify for a F.H.A. loan after a bankruptcy.
The fastest way to build score is to get at least 1 more card and use them both for every day things and pay them off in full before the due date.
You can also take out a loan against your $5,000.00 and pay it back in 12-months just make sure that your bank reports to all of the credit bureaus first.
References :
Finance Manager for over 9-years / BK in 2000.
You have the answer- a secured Visa/Mastercard- Use no more than 30% of your limit- don’t pay late- pay more than minimum payment but don’t pay it off each month. After 6 months they will usually increase your limit. When paying rent- pay by check- the mortgage company is going to want proof of on time rent for 24 months. A handwritten receipt does not work (anyone can write their own receipt). FHA will also let you use non-traditional credit such as light bill- cable bill- etc if you don’t have enough credit. Just make sure you have at least a year of that (with everything in your name). Put the $5000.00 in savings now & keep it there. You will need 3.5% down for FHA. No bad credit allowed after the bankruptcy so make sure of that. Good luck! You will need a 620 credit score most likely.
References :
23 years mortgage lender
Never borrow money again and don’t worry about your credit anymore.
References :