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Tennesseans can rebuild credit after filing for bankruptcy

Those in Tennessee who have filed for bankruptcy or are considering it often have many concerns. Amongst them is how bankruptcy will affect one's credit. While it is true that bankruptcy will negatively impact an individual's credit score, it is not a mark that will doom an individual to a lifetime of financial ruin. In fact, there are many steps that can be taken after declaring bankruptcy that might help rebuild one's credit.

The first thing an individual should do is ensure his or her financial stability. This means pulling a credit report and dealing with any inaccuracies, creating a budget, and setting aside money for emergencies. Once this is done, then an individual can consider applying for a credit card. After bankruptcy, it will likely be easier to obtain secured credit cards, as the lender is protected from potential losses. By creating a history of on-time payments, an individual's credit score will improve and unsecured credit cards may become available to him or her. However, it is important that an individual is mindful of how much debt he or she is accumulating, lest he or she find herself on rocky financial footing again.

Another option for rebuilding credit include taking out a personal loan from a local bank. This may require the borrower to have a co-signer, but it may be a strong way to show creditors that one is financially responsible.

Though credit considerations are a major aspect of deciding whether or not to file for bankruptcy, there are many others. Those with credit card debt may want to stop creditor harassment and/or wage garnishment. Those with other kinds of debt may feel overwhelmed by the amount of debt they owe. When financial challenges threaten to ruin an individual's personal and professional well-being, it may be in his or her interest to speak with a bankruptcy attorney about what can be done to get them on the path to a new beginning.

Source: USA Today, "Personal Finance: Re-establish credit after bankruptcy," Robert Powell, July 3, 2014

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Mark T. Young & Associates
2895 Northpoint Blvd.
Hixson, TN 37343

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