How long must I wait to rebuild my credit after bankruptcy?

One of the biggest concerns of people contemplating bankruptcy is the impact it will have on their credit.  It’s no secret; bankruptcy will negatively affect your credit.  However, if you are to the point that you are considering bankruptcy, you are probably so far behind on your bills that filing bankruptcy will not make your credit rating significantly worse than it already is. 

The good news is that filing bankruptcy is not the end of the world.  As a matter of fact, filing bankruptcy can actually improve your credit because it stops aging on your credit report. This means that your creditors will no longer be able to report your accounts as delinquent each thirty day period you are behind on your payments.  Moreover, because interest, late fees and penalties stop accruing on certain debts once you file bankruptcy, your credit report will no longer show your balances increasing.  The overall impact will be to improve your credit score. 

You can begin rebuilding your credit immediately after your case is discharged by following these steps: 

1. Pay your utilities on time;
2. If you reaffirm any of your debts as a part of the bankruptcy, make the payments on time each month;
3. Begin making student loan payments on time each month;
4. If you have non-dischargeable tax debts, contact the IRS or state taxing authority and arrange an installment plan; and
5. Obtain a secured credit card, use it sparingly, and pay it off at the end of each month. 

If you have any questions about rebuilding your credit after bankruptcy, speak with a qualified bankruptcy attorney in your area.