Hi. I’m Mike Greiner. I’m a bankruptcy attorney here with The Financial Law Group located in Warren, Michigan. Our website is financiallawgroup.com, and my phone number is 586-693-2000. And I’m here to talk to you today about steps you can take to repair your credit after filing bankruptcy. One of the biggest concerns a lot of my clients have is how they can rebuild their credit after filing bankruptcy and it’s really surprisingly easy. What improves your credit over time is making timely payment on debts. So people a lot of the time will have all kinds of theories about this will improve your credit or that will improve your credit or this will hurt your credit or that will hurt your credit and the truth is most of those ideas are just myths. What helps your credit is making payment on your debts on time. So what you’re going to want to do after you file bankruptcy is actually get a little bit of debt. I know that sounds crazy but that’s the way that you improve your credit score. You want to get a credit card or two.  Now if you say, I can’t get credit cards, you’ll be amazed how soon after filing bankruptcy you’ll start to get credit card offers in the mail. If for some reason you don’t get credit card offers in the mail, there are two other routes you can go. Some of my clients have found that gas stations are a great place to go where you can go apply for their local credit card and then just use that credit card to buy gas every month and pay it off on time each month.  Marathon in particular I’ve seen is a good one.

Another option would be to gets what’s called a secured credit card. If you Google secured credits cards you’ll see a bunch of options pop up. I believe Consumer Reports said that Orchard Bank had a particularly good one.  What a secured credit card is, is it’s a real credit card. It’s not a debit card, like you, what you got from your bank or a prepaid credit card. It’s a real credit card but it’s just that, they, you give the bank a certain amount of money for them to hold on to, to make sure you make your payments. So, for example, say, then, you give the bank $300, then they give you a credit limit up to $300. And, over time, as you start to establish your history of charging a little bit and paying it off on time each month they’ll start to increase that credit limit, and at some point they might not require you to have a deposit with them anymore.  Secure credit cards are actually excellent ways of rebuilding your credit. Ideally you’ll want to get two or three ongoing credit lines that you can pay on each month as you’re going forward.

Car payments would be included. Car payments are a good option. As long as you reaffirm the car as you’re going thru bankruptcy. If you continue to make those car payments, that would be something that would improve your credit. Again secured credit cards or other credits cards are great options as well.  Don’t count on your mortgage payment helping you. Making your mortgage payment each month will not actually help you improve your credit score. So again, the key thing will be get some credit, and charge a little bit each month, and pay it off on time each month. Doesn’t have to be a lot, twenty, thirty dollars a month will be enough on some of these credit cards. They just want to show that you have that history of charging a little bit and paying it off on time each month. That’s what’ll improve your credit over the long term.

If you want to find out more about filing bankruptcy or repairing your credit, give my office a call. Our phone number is 586-693-2000 and I’ll be happy to meet with you personally.