How Fast Can You Rebuild Credit After Bankruptcy in Georgia
The choice to file for bankruptcy can be a difficult decision to make, but it can offer life-changing relief to those who have been struggling with debt and cannot find any other option.
Unfortunately, people who could benefit from filing for bankruptcy in Georgia are sometimes scared off from pursuing this option based on misinformation about the impact it will have on your credit.
While bankruptcy will initially take a toll on your score, most people can rebuild within a year. It’s essential to get expert advice before deciding anything, so make sure you consult with a knowledgeable Georgia attorney before reaching a conclusion.
How To Rebuild Credit After Bankruptcy?
You probably already know that having a low score can prevent you from obtaining loans and credit cards. After filing for bankruptcy in Georgia, you can wipe out the debt that made your number fall in the first place and then rebuild from a clean slate.
While the filing will remain on your report for up to ten years, the positive effect on your score usually surpasses any damage it does. In reality, many people actually see an improvement after they file.
How Long Does It Take?
One of the ways you can start to rebuild after a Georgia bankruptcy is to wait at least 6 months to open any new accounts. Submitting applications for financing too soon could harm your credit, so make sure you avoid applying for a loan or another account until your score has started to recover.
Six months of making on-time payments is generally long enough for your credit to begin to improve. Additionally, creditors will be able to see a pattern of responsible behavior and positive payment history on your report, which can help you get approved for financing.
What Else Do You Need To Know About It?
It’s important to keep in mind that your credit was likely already destroyed if you met the requirements to file for Chapter 7 or Chapter 13 in Georgia. Late payments, collection accounts, and high balances can all contribute to low scores.
While bankruptcy does cause filers’ scores to drop initially, it also wipes out their debts, which generally will substantially reduce their account balances. It also puts you in a position to make payments towards your remaining debts on time, which allows you to rebuild a positive history and raise your score.
Rebuild Your Credit With A DebtStoppers Plan
It can take some time to rebuild your credit, but filing for bankruptcy in Georgia will actually improve your score in most cases. While your situation won’t recover overnight, initiating a Chapter 7 or Chapter 13 case is the first step in improving your financial circumstances.