Bankruptcy Law, Credit Score

Tips for Rebuilding Credit After Bankruptcy

Filing for bankruptcy allows people to get a fresh start financially and erase past debts, but a legitimate concern many consumers have is the effect it will have on their credit score and their ability to take out credit, again.

One of the biggest misconceptions about filing for bankruptcy is that it will ruin your credit score and your financial future.  To the contrary, after filing for bankruptcy you can begin restoring your credit right away.

The bankruptcy discharge allows the consumer to rid himself or herself of crushing debt. This debt could include unsecured credit card debt, as well as medical debt. Filing for bankruptcy also puts an immediate stop to harassing collection calls and legal collection proceedings. This chance for reprieve also offers the person an opportunity to work through his or her financial dilemma, properly prepare a budget and pay off necessary and unavoidable expenses.

Here are some steps you can take to begin rebuilding your credit after filing for bankruptcy:

Monitor Your Credit Report

The only way to truly know where a credit score stands is if that person monitors his or her credit report on a regular basis. It is not uncommon for mistakes to be found on a person’s credit history, and these mistakes can often prove costly if not detected and fixed. The three major credit bureaus all allow consumers to obtain free annual credit reports through

It also helps to continually monitor your credit report following a bankruptcy filing to ensure that all accounts that were discharged through bankruptcy are shown as discharged on the report. If they are not, this can be corrected through reporting this error to the credit bureaus. Additionally, many consumers find it helpful to track how they are doing in terms of rebuilding their scores by periodically checking their scores.

Secured Credit Cards

Many consumers find value in rebuilding their credit through use of secured credit cards after bankruptcy. Secured credit cards are helpful when the consumer does not qualify for a regular credit card. They work in the same manner as traditional cards, but they are secured and limited by a cash deposit in the event the consumer cannot make payments. By using a secured credit card responsibly over the course of time, the consumer can rebuild his or her credit score to the point where that person can then obtain a regular credit card, especially considering secured cards tend to come with higher interest rates and fees. Keep in mind they are meant to be short-term solutions in beginning to rebuild a person’s credit score.

Stick to a Budget and Practice Good Financial Habits

One of the best ways to rebuild someone’s credit score is to demonstrate fiscal responsibility. This can only happen over the course of time and takes discipline, as well as patience. Work with a financial advisor or credit counselor to prepare a reasonable monthly budget by looking at what income is coming in and what necessary expenses need to be paid. The consumer should also look at the bad habits that brought him or her into the situation originally and avoid those behaviors at all costs. As the person’s financial picture improves, work hard to not fall into same traps. Ensure that all necessary bills are paid on time to avoid taking another hit to your credit score.

Build an emergency fund

Research shows that having as little as $250 saved up for an unexpected expense can protect families from having to resort to pay day loans and credit cards.

Avoid Scams

Many “credit repair” agencies exist that seek to take advantage of consumers looking to boost their credit score quickly. They will offer services that a consumer can easily do for himself or herself at no cost. Always do proper research on these companies before signing or agreeing to any terms with them.

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If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at




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