Credit After Bankruptcy - Ways To Improve Your Chances of Getting Approved For A Loan
Bankruptcy doesn't have to prevent you from securing credit. With some
research on your part and careful financial planning, you will improve
your chances of getting approved for a loan with reasonable rates and
terms. It all begins by cleaning up your credit report and slowly
opening new credit lines.
Take Advantage Of Your Credit's Fresh Start
Make sure that you are getting the most from your discharged bankruptcy
by verifying that all your old credit accounts are closed. A quick look
at your credit report will help you confirm that your bankruptcy has
been properly reported by each creditor. This is also a good time to
evaluate your credit score.
If you haven’t already, open a credit card account to reestablish your
payment history and credit score. Use your card; then pay it off each
month to avoid racking up debt, which can hurt your credit score.
Consider opening another account in six months.
Credit card accounts are the easiest form of credit to qualify for. And
even if you do end up with a high interest rate at first, you don't
have to pay those interest charges when you pay off your balance each
month.
Build Up Your Assets For Better Rates
There’s nothing like cash assets to make a banker eager to approve a
loan, even with a bankruptcy on file. While stocks, real estate, and
bonds all contribute to your net worth, lenders prefer to see cash in easy
to access accounts, such as a savings or money market accounts.
Two months of living expenses in savings is the minimum for most
financial companies require when offering sizeable loans. Increase that
amount and you will see your loan rates drop. Add in a large down payment or
salary, and you will qualify for even better terms.
Shop Around For Lower Rates And Fees
The best loan rates and fees are out there for those willing to do a
little research. With most lending companies online, it's simple to find
information on interest rates, terms, and fees. You can even request a
free loan estimate without hurting your credit score.
With so many lenders offering financing for those with poor credit, it
can be intimidating. So begin investigating companies that have been
recommended. Broker sites are also a great way to collect information
from a multitude of companies in one spot.
Our Recommended Free Credit Report Companies:
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