When the discharge is complete you can start rebuilding your credit while someone who went through a Chapter 7 at the same time is already well on his way to repairing his credit.
Adopt a positive attitude
Bankruptcy experts insist that attitude and persistence can make a difference."The consumer who's going to recover faster is the consumer who jumps back in," says Ulzheimer.
"Financial capacity is one thing," says Tahira K. Hira, a professor at Iowa State University who specializes in consumer economics and family finance. "Mental or attitudinal capacity is the other thing."
So if you build a savings account, carry no debts and have an emergency fund, you're saying, "Look, I can control my behavior," she says. "It depends on how good a salesperson you are and how good your behavior has been."
Show what you now know
But you have to shop lenders, "and there will be a price attached, which is higher interest," says Hira.In the first six months after your bankruptcy discharge, you want to demonstrate you've learned from your financial mistakes. You've got to be a model citizen from here on when it comes to financial management. That means making all your payments on time and building up a savings account for those inevitable rainy days. If you've managed to keep a credit card through the bankruptcy, use it once in a while to buy a necessity and pay it off immediately.
First new credit card
If you don't have a credit card, establish good financial habits and apply for a secured card. "A general guideline would be six months [after your discharge]," says Whelan, a bankruptcy judge for 12 years.You'll put money in an account and the credit card company will give you a credit limit of that same amount. When the bill comes in, you pay it, as you would a normal card. You get the deposit back only when you close the account or switch to an unsecured version. Some card companies may also be willing to give you a credit limit higher than your actual deposit, says Curtis Arnold, founder and spokesperson for Cardratings.com. Tip: Look for a card that reports to one, and preferably all, of the credit bureaus.
The good news: Many secured cards report as unsecured cards, says Arnold. "And assuming your account's in good standing, once you've had it for a year you should start getting halfway decent offers on unsecured cards."
Some smart shopping tips: Look for names you recognize and the lowest fees and rates you can find. And only consider a card that bills any fees to your card or bills you directly after you receive it. When they want money up front, chances are it's a scam, says Arnold.