Questions re: rebuilding our credit.

[needingsomehelp]

Hi everyone-

We will be discharged on the 22nd (woohoo), this has been a long process and I am so excited to be able to "start fresh". Honestly, I wish we didn't need to get credit, but we do want to rebuild our credit, so I guess there is not much choice in the matter.
Anyways, in a month or two, my husband I would each like to get a credit card, just to make small purchases with and pay of immediatley. Can anyone recommend a particular company to go with that is BK friendly, yet not fee happy. Is there any in particular that we should stay away from?
Also, right now my credit (FICO score) is 570, and most things are already showing a zero balance, and dishcharged. My husbands score is 580 right now, but he has several accounts still showing balances, so I would assume after the discharge his score will go up more. (The BK is already reflected on both of our reports). Is this true.
Finally last question, our home is in my husbands name. We surrendered it in BK7, will my husbands score go down, once the foreclosure hits, or will it just be included in the BK??

Sorry for all of the question! hopefully someone can help me out!! Thanks so much, you all are WONDERFUL!!

[soleprop]

hi, just clarifying - making small purchases and paying off immediately may not establish good credit the fastest; i'd think showing you can carry a balance and make payments over 6 months to pay something off would work more to your advantage. you could buy a piece of furniture with a 6 month payoff, that sort of thing. take out a $1k loan if you can get one from an understanding lending agency and pay every payment on time, etc.

my understanding is just having a credit card and paying it to $0 each month does next to nothing to improve credit; it's the payment history over a period of time against a debt that improves your rating.

good luck!

[Flamingo]

There are numerous (and I mean numerous) postingson this forum regarding your questions. In fact, postings such as yours seem to be the most asked on here. You can do searches on here which will present you with all sorts of information and options. But a lot of us on here agree that have been through BK that it is best to stay away from credit cards for a while until one learns to adjust to living on a cash basis (Chapter 7 folks). Chapter 13 folks have no choice as they are basically forced to do so for 3 to 5 years. Credit/debt is what got you to the position you are now in and a BK on your credit reports will probably get you denied credit many times during the next 10 years so "starting fresh" should not mean getting credit cards immediately when discharged. You will find that obtaining credit over the next few years will be difficult, if not impossible at times.

[needingsomehelp]

HI, thank you for your replies. When I said start fresh, I honestly didn't mean that we wanted to run out and get credit. My husband and I are actually planning on living on cash. We would prefer not to carry credit at all, however we both want to get our credit score up as soon as possible, in order to hopefully one day be able to buy another home (we have learned not to get ourselves into another bad mortgage). We were also told that getting a small credit card, making a purchase and paying it off, is the best way to rebuild credit.
Our circumstances were not actually based on credit card debt, as a matter of fact we didn't discharge much credit debt, we mainly filed BK because we were trying to save our home, and it didn't work out. We were never irresponsible with our cards, and always paid them in a timely manner. We were not fortunate enough to know much about ARM though, and unfortunately ended up converting to a chapter 7 and letting our home go, it was pretty heartbreaking.
Anyways- just wanted to clarify a bit. Thanks so much!

[Flamingo]

I completely understand your situation. But as you get beyond what occurred you will eventually realize that if the debt was not there to begin with when the ARM went up as to your house payments, you would probably not have had to consider filing BK. Debt is always behind filing. Debt has to be more that assets in order to be BK/insolvent. Learning to handle money in today's world is difficult for anyone unless we are rich enough to afford our own brokers and accountants. Learn from this as most of us do and follow budgets and slowly obtain credit to improve your scores over time. This is the best advice anyone can give you coming out of a BK.

Predatory lenders took advantage of a lot of folks over the past several years to make that comission. I am sorry you had to let your house go. I am sure in several years you will be able to obtain a nicer home in its place and go on happily from there. Best of luck.

[needingsomehelp]

Thanks you so much for your advice and encouragement!! You seem to have a lot of knowledge in this area!!

[Flamingo]

Thanks you so much for your advice and encouragement!! You seem to have a lot of knowledge in this area!!

Filing BK is an eye opener no matter what area of work in which the filer(s) work. Most people that go through it make lifestyle and other changes to ensure they never go through it again. Life bites though at times and things can get bad again but the key is to stay in a position to learn to make your money work for you, not for it to control you. None of us need the $475 pair of eye candy designer shoes on sale unless one is in a job where their employer pays for your wardrobe. If you can remember that in the years to come, you should be fine...best of luck....