RACHEL ASKED: I claimed bankruptcy due to a divorce and was released two years ago. What is the best way to build my credit fast?
ANSWER: It is possible to rebuild your credit rating after filing personal bankruptcy, however it does take time. Rebuilding your credit rating is a process.
The first step when trying to rebuild is to check your credit bureau report. You can get a free copy of your credit bureau report through the mail. You want to make sure that all of the information on your personal credit bureau report is accurate and correct any errors.
Once you have made sure that your credit bureau report is accurate you can focus on rebuilding. When I explain credit rating to people I use the analogy of your credit report being like a report card in school. Filing personal bankruptcy is like getting a “F” on your report card. Anyone who has ever gotten a “F” on their report card will tell you that if you have a “F” and a bunch of “A’s” your average isn’t a “F”. I hope that makes sense.
The question then becomes how do you get “A’s”? In order to get an “A” or a good mark on your credit “report card” you have to borrow money and pay it back. The difficult part is convincing a creditor to lend you any money when you have a bad credit rating.
In many cases the best way to rebuild your credit rating is to get a “secured credit card”. Creditors are willing to give you a secured credit card no matter how bad your credit rating is because you give them a deposit which they hold as security for your credit card. Be sure that you are getting a secured credit card and not a cash card. Cash cards are offered by payday loan places and they don’t help you to rebuild your credit rating.
By using your secured credit card, borrowing and paying back, borrowing and paying back, etc. your credit card company will report positively on your credit bureau report and you will start to accumulate “A’s”.
Good Luck!
