Many New Jersey residents are struggling financially right now. Are you one of them? If you are, you have surely spent time looking at all of the debt relief options out there. Chapter 7 bankruptcy may have crossed your mind, but you are worried about the long-lasting effects it will have on your credit score. Guess what? Bankruptcy will not destroy your credit forever.

Rebuilding your credit after bankruptcy is possible. It just takes time and effort. In the long run, choosing this form of debt relief may end up being the best thing for you.

Start the credit rebuilding process

After receiving Chapter 7 approval, completing process will result in the discharge of all eligible debts, and you will have the fresh financial start you desired. However, the bankruptcy filing will stay on your credit report for up to 10 years, which can make it difficult for you to obtain lines of credit either at all or with relatively decent interest rates. You know this is part of it, but it can still hurt when it happens.

When it comes to rebuilding your credit, there is no amount of time that you have to wait before you can get started. This is something you can do right away.

The first step to rebuilding your credit is to create a budget and stick to it. It can be difficult to do, but it will help you keep your finances in check so you do not end up back where you were. The next thing you can do is start an emergency fund. Even as little as $250 in savings can prove helpful when an emergency occurs.

Now the real work begins. You will need to figure out what type of credit product will help you reach your goals. There are only so many options available to individuals who have bankruptcy filings on record. A few options include:

  • Becoming an authorized user on someone else’s account
  • Applying for secured credit cards
  • Asking someone to co-sign loans or credit cards
  • Applying for secured loans

By utilizing any of these credit-building opportunities appropriately, it is possible to show lenders that you can be responsible with money and can make payments on time. Over time, this will raise your credit score, which will, in turn, open doors and allow you to apply for lines of credit with better terms and interest rates. Rebuilding after Chapter 7 bankruptcy is difficult, but you can do it.