All Is Not Lost: 5 Tips for Getting Approved for Credit Cards or Loans After Bankruptcy

After a bankruptcy is discharged there are several things that you’ll need to be aware of. One of the biggest things people discover is that their FICO credit score has dropped significantly. This makes it much more difficult to get approved for a credit card or a loan. While getting back into debt shouldn’t be rushed into, there are times when it is necessary to get approved for some type of credit, even in the initial months or years after a bankruptcy. The following tips can help you to get the money you need, without putting yourself in a difficult financial situation.

Apply for a Secured Card

The easiest way to start rebuilding your credit is to get a secured credit card. These are offered by most major credit card companies and allow you to ‘deposit’ money into your credit card to secure the payments. While not your traditional credit card, if you make your payments on time each month it can really help to boost your credit rating so you can transition into a normal credit card in the future.

Get a Secured Loan

Like a secured credit card, you can get a loan that is secured by some asset. If you have equity in your home, for example, you can often get a loan using it as collateral. This reduces the risk that the lending institution takes on so they are more likely to approve the loan (and at a more reasonable rate).

Find Someone to Cosign

If you need a car or personal loan, you can ask a friend or family member to cosign for you. This simply means that they agree to repay the loan if you fail to. Be careful with this option, it can introduce conflict into the relationship if you don’t make your payments. If you have someone who is willing, however, it is likely the easiest way to get the credit card or loan that you need. If you make your payments on time every month, this will help to boost your credit score.

Dispute Any Errors on Credit Report

After a bankruptcy you might think that your credit score is a lost cause and only time will bring it back to a respectable level. The fact is, however, that if you can start removing negative items from your report, your score will go up much more quickly. You can get a free copy of your credit report and look for any errors. If you find any, file a dispute to have them removed so your score can start to go up.

Apply at a Local Bank or Credit Union

While it might not be possible right away, your best chance at getting approved for a traditional credit card or loan is going to a local bank or credit union, especially one you have been with for some time. Local institutions are often more flexible than the huge national options. Make an appointment with the branch manager and discuss the options you have available.

We hope that this blog helps you not lose hope in the post-bankruptcy process, and let The Starosta Law Firm handle any bankruptcy issues you may face!

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The Starosta Law Firm LLC

The Starosta Law Firm is a small firm dedicated to providing every client with the customized representation they require, no matter what type of situation they are facing.