top Ad Widget

Collapse

Announcement

Collapse
No announcement yet.

Rebuilding Credit

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Rebuilding Credit

    I just filed Chapter 7 and my bankruptcy was final on September 20, 2003. I had virtually nothing so it was a cut and dry case. I'm starting over. It was all credit card debt.

    I read an ebook on how to rebuild credit by taking out small loans and paying them off. I'm thinking of doing that.

    The only thing I have to my name worth any value is my monthy paycheck, which isn't much. I pay my bills with money orders.

    I know these credit cards can get you in trouble, I'm living proof. However, I was curious if applying for one card would be a good or bad idea.

    I do not want to go under again. However, what really put me in over my head was I got laid off and was paying my bills via credit cards because I couldn't find a job and unemployment just wasn't cutting it. This is not to say I was not in debt prior, I just was able to handle it better with a steady job. ;)

    #2
    Originally posted by jammy
    I just filed Chapter 7 and my bankruptcy was final on September 20, 2003. I had virtually nothing so it was a cut and dry case. I'm starting over. It was all credit card debt.

    I read an ebook on how to rebuild credit by taking out small loans and paying them off. I'm thinking of doing that.

    The only thing I have to my name worth any value is my monthy paycheck, which isn't much. I pay my bills with money orders.

    I know these credit cards can get you in trouble, I'm living proof. However, I was curious if applying for one card would be a good or bad idea.

    I do not want to go under again. However, what really put me in over my head was I got laid off and was paying my bills via credit cards because I couldn't find a job and unemployment just wasn't cutting it. This is not to say I was not in debt prior, I just was able to handle it better with a steady job. ;)
    Depending upoon your current fico/beacon score you may qualify for a secured credit card with a initial credit limit of $250 -$350. If you fico/beacon score is to low, wait about six months and apply for a secured credit card that reports your payment history to all three CRAs, and one that doesn't list your account with them as a secured credit card.

    You may also recieve "Pre-Approval" letters from several different secured credit card companies. I suggest researching each company prior to apply for credit with them. Be weary of the steep annual/monthly fees a lot of the companies charge too.

    Good Luck
    The information provided is not, and should not be considered legal advice. All information provided is only informational and should be verified by a law practioner whenever possible. When confronted with legal issues contact an experienced attorney in your state who specializes in the area of law most directly called into question by your particular situation.

    Comment


      #3
      It's really important to re-establish your credit if you're considering purchasing a home in the future. Lender's like to see you've been making regular monthly payments since a BK because it gives them confidence you know how to handle money prudently.

      I suggest starting by obtaining two secured credit cards for low amounts (approximately $300-$500) and making regular monthly payments. After 12 months of making regular payments, ask the credit card company if you can convert to a non-secured card and increase the limit. Then after 6 more months of regular payments, ask for another limit increase.

      After my bankruptcy concluded, Capital One offered me a secured Master Card credit card. I paid them $99.00 and they provided me with a secured card with a $1,000.00 limit. After 12 months of regular on time payments, they converted it to a non-secured card, increased the limit to $1,500.00 and gave me my $99.00 back, with interest. Then, about 6 months later, they offered me a non-secured Visa credit card. Those are the only two credit cards I pocess and I use them for the sole purpose of credit re-establishment.

      I'm working with a borrower right now and her chapter 7 is 3 years old. For the last 3 years she has been paying all her debt with cash and living with her parents since the BK. Her credit report doesn't have any dings for 3 years but it also doesn't show any re-established credit, and the Lender's don't like that.

      I can get her a loan but not the one she wants. She found a condo she really wants and can't afford a down payment and needs a 100% loan. It would have been easy to get the loan for her if she aquired two credit cards 2 years ago and had a good payment history.
      Raymond
      [email protected]

      Comment

      bottom Ad Widget

      Collapse
      Working...
      X