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Tips for rebuilding credit after bankruptcy

One concern people in Ohio might have regarding filing for bankruptcy is how it will affect their credit rating. Although bankruptcy can remain on a person's credit report for as long as 10 years, it is possible to begin rebuilding credit soon after bankruptcy and to have a good score within a few years. One study found that nearly two-thirds of people had a credit score of at least 640 two years after filing bankruptcy.

The first thing a person should do after a bankruptcy has been discharged is apply for a secured credit card. This requires providing a deposit, and the initial credit limit for the card will be at or around the amount of the deposit. This card should be used at least monthly and also paid off monthly. One good idea is to put a recurring monthly charge on it. It is best if the charge is less than 20 percent of the credit available. This shows that a person will not use up all the credit and responsibly pays the monthly bill.

There are free credit score services a person can sign up for to monitor any identity theft. Finally, while many bankruptcies are the result of events outside a person's control, such as medical debt, people who simply overspend should review their budgets and habits.

With a Chapter 7 bankruptcy, a person may be able to discharge most debts, with a few exceptions, such as child or spousal support and some tax debts. Student loan debts are only discharged in rare and unusual circumstances. A person may also be able to declare some assets exempt in a Chapter 7 bankruptcy. Bankruptcy paperwork can be complex, and errors may delay the process, so a person may want to work with Mayfield, Ohio Chapter 7 bankruptcy lawyers on the filing.

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