Nobody wants to declare bankruptcy, and nobody wants to admit that they are at the point of needing to file for bankruptcy, but it is a reality for many people. Frequently, this is due to a situation beyond their control and is not attributed towards poor financial management. But whatever the reason, one of the problems faced by consumers who declare bankruptcy is getting their life back on track afterwards and being able to get new credit.
You undoubtedly have already discovered that after filing bankruptcy, this act leaves a huge red flag on your credit report for many years, and it may seem almost impossible to get approved for a new line of credit, even with a local department store or a gasoline credit card.
But the informed consumer needs to realize that while traditional efforts to get new credit may not be fruitful, there are several ways that someone can get credit after bankruptcy with a bit of research and knowledge of how the system works. You need to realize that it not going to happen overnight and will take time to get you established as someone who is not going to declare bankruptcy again next year, but it can be done and is being done by thousands of people who have filed bankruptcy.
The very first thing you need to do is to get copies of your credit report from each of the three major credit reporting agencies. Each of them keeps a separate credit history and profile on you, so be sure you get a copy of your report from each of them. Getting only one of them or even just two of them is not going to help you.
Next, go over your credit reports with a fine tooth comb. Be aware that the majority of consumer credit reports contain errors, and you are looking for errors, inaccuracies and things that are just not being reported correctly. Chances are better than excellent that you will find at least one if not more items that are incorrect. It is your duty to dispute those items with the credit bureaus. It is the credit bureau's legal responsibility to investigate the items you are disputing, and if they cannot be verified as being accurate as shown, then it is their legal responsibility to remove that item from your credit report.
The reason this step is critically important is because even though your bankruptcy is going to be readily apparent in your credit report, you want to remove anything else that is negative, and this is your right if the information is not accurate. The effect of removing these items will raise your credit score, and your computed credit score is going to be the key element that defines whether or not you are approved for new credit.
You should also put a personal statement in your credit report. Each of the credit reporting agencies allows you to enter a personal statement up to about 150 words. Use this statement to explain why you had to declare bankruptcy and to minimize the negative effects of the bankruptcy. If it was due to a job loss or high medical expenses, explain that, which puts your bankruptcy in a totally different light, and something that new credit granters will look at when they pull your credit report.
