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Tips On Rebuilding Your Credit After Bankruptcy

You can begin rebuilding your credit immediately after declaring bankruptcy - and establishing stronger credit will make your post-bankruptcy life much easier. While some types of spending and some types of credit will help you, others will hurt your credit score. Below are some tips on the best ways to rebuild your credit in the wake of a bankruptcy.

· Get a credit card. Although you should never spend more than you have, a credit card is central to upping your credit score. However, the way in which you use your credit card could hurt you. Be sure never to max a card out - instead, only use about 30% of your limit and pay your bill on time. Watch out for credit card companies that prey on people with bad credit - they might offer extremely high interest rates and fees.

· Establish a line of credit. If you find it difficult to do this through your bank, try going through a credit union. Make the loan a small one, and be deliberate in paying it back.

· Use cash. The best way to prevent overspending is to use cash. Some people even find it helpful to set aside cash in their bank account each time they use their credit card so that they are sure they have money to make the payments.

· Beware of quick fixes. Understand that reestablishing your credit is very possible, but it takes time, patience, and hard work. Companies that claim that they can fix your credit quickly are most probably scammers at work. Be especially wary if they are asking you for a fee. If it's too good to be true, it probably is.

· Keep an eye on your credit score.

· Show creditors that you are responsible. Pay your bills on time, pay off your balances, and don't take out huge loans.

· Make regular deposits into your saving account. This will not only show that you are responsible with your money, it will also help you in the case of an emergency.

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