In today’s economic recession it is getting very hard for the average consumer to manage their current obligations. Whether this be a mortgage, credit card, car loan, or any other type of debt, when someone finds it difficult to manage these payments they might find themselves with no other choice but then to file for bankruptcy.

Over the past decade or so consumers have been spending their money like crazy buying things they do not necessarily need like a big house, boat, multiple cars, etc. Once our economic turn down arised in 2007 events such as these have left many consumers in a world of distress. No longer does the average homeowners have a ton of equity which allows them to take on another loan, and with the unemployment rate at a steady 10% the chances of these people maintaining their monthly obligations is very unlikey.

Sometimes they find that they can’t pay for them due to more or less objective reasons. Maybe something like this has also happened to you and you can’t pay for assets you have bought in the past. It may not be your fault. It might have been a job loss that has caused you to not be able to pay your bills and not the fact that you overspent on things that you did not need and only wanted.

So the only option that you had was to file bankruptcy and now your credit has been ruined and this event will stay on your report for ten years. With a low credit rating it will be very difficult to obtain to any kind of loan for a car, home, or even a credit card. If you need to obtain a loan or possible even a credit card it is crucial that you attempt to repair your credit after the bankruptcy.

The very first thing you should do is pull a copy of report from one of the credit bureaus to make sure all of the information on there is correct. Due to the Fair Credit Reporting Act you are entitled to one free copy of this report every twelve months so do not worry about paying to receive this. when reviewing your report make sure all of the creditors are reporting the information accurately, and if they are not you need to dispute this right away. It would be terrible to be penalized for events you had no control of. Once you verify all of the information is correct you can start working on rebuilding your score before taking on new debt.

However, after you have filed bankruptcy, there is a chance you may be able to obtain a small loan from a bank or possibly even a credit card at a high interest rate. The best and most effective way to begin rebuilding your credit is by paying on your loans or other current debt on time every month. You don’t want to miss a month’s payment or be late because you want to make a good impression, you want to show that you really are trying to rebuild your credit and are now much more responsible managing your obligations.

Paying your bills on time from now on is very important, so don’t think that it is not. Find a credit card or a bank to lend you a small amount of money and then pay it back on time, if you do not already have these. This is a great way to build your credit score back up after bankruptcy and be prepared because this may take years to do. Bankruptcy is one of the most devastating events that can damage your credit rating other than a foreclosure.

Another option you can explore is a credit repair counseling service. These services will teach you how to rebuild your score while at the same time learning how to better manage your budget. You must sit down and take the time to figure out your whole financial situation to prevent similar events from happening in the future. Some companies provide this service free of charge! One company you may want to check out is Consumer Credit Counseling Services.

Once you have figured out a new budget and made sure all of your credit information is correct, it is time to start watching your score slowly build. Just make sure that you pay your bills on time from now on and don’t be late on your payments. Once your credit is rebuilt, you should have no problem obtaining the assistance you need in the future, whether it be a credit card, car loan, personal loan, etc.

Moe Bedard
My name is Maurice "Moe" Bedard. I am the founder of America's #1 Mortgage Forum, LoanSafe.org. My online work has been featured in the New York Times, LA Times, Fox Business, and many other media publications.