Bankruptcy can be a confusing subject for many of us.  Many clients ask, “If I file Chapter 7 bankruptcy, will I be able to rebuild my credit?” The answer is “Yes!”

A Chapter 7 may be an option for you if you have significant debt and are receiving frequent collection calls at home or work, and creditors are about to garnish your wages. A Chapter 7 bankruptcy eliminates most debts such as credit cards, medical bills, judgments, mortgage deficiencies, collection accounts, and many other debts. Filing Chapter 7 bankruptcy in Colorado will eliminate all debts except student loans, child support, overdue taxes from the past three years, and court-ordered restitution. The biggest benefit of filing Chapter 7 bankruptcy is that it only takes 90 days and you can start rebuilding your credit.

Rebuilding Credit After Filing Bankruptcy

Rebuilding your credit after chapter 7 bankruptcy is fast and easy – provided you follow some simple tips.

If Chapter 7 is the best solution for you, you may be wondering if you are able to rebuild your credit and how long it would take. You can rebuild credit within one year provided you take the appropriate steps.  First, you need to establish three lines of new credit after you get your bankruptcy discharge. That means getting new credit cards, obtaining a car loan, or a combination of the two.  Yes – you do get credit cards after filing bankruptcy. The limits are lower, but you still get them.

Use your new credit cards responsibly. This means you never carry a balance more than 30% of the limit.  For example, your new credit card offers a limit of $1,000.  It’s ok to buy things with the card, but do not carry a balance over $300. Otherwise, it will count negatively against your credit score.

For other tips on rebuilding your credit, such as reviewing your credit report for errors, check out this blog from “the balance.”

Contact Colorado Debt Help about Chapter 7

If you’re struggling to pay your bills and feel overwhelmed by your debt, call Broomfield bankruptcy attorney, Rob Fuicelli, at Colorado Debt Help who can help you decide if Chapter 7 bankruptcy is your best option or whether there is another financial solution for you. Our solutions include debt settlement, credit counseling, debt management plans, and other debt relief options.  The first appointment is FREE so get help now!