Bankruptcy doesn't have to prevent you from securing credit. With some research on your part and careful financial planning, you will improve your chances of getting approved for a loan with reasonable rates and terms. It all begins by cleaning up your credit report and slowly opening new credit lines.



Take Advantage Of Your Credit's Fresh Start

Make sure that you are getting the most from your discharged bankruptcy by verifying that all your old credit accounts are closed. A quick look at your credit report will help you confirm that your bankruptcy has been properly reported by each creditor. This is also a good time to evaluate your credit score.

If you haven't already, open a credit card account to reestablish your payment history and credit score. Use your card; then pay it off each month to avoid racking up debt, which can hurt your credit score. Consider opening another account in six months.

Credit card accounts are the easiest form of credit to qualify for. And even if you do end up with a high interest rate at first, you don't have to pay those interest charges when you pay off your balance each month.

Build Up Your Assets For Better Rates

There's nothing like cash assets to make a banker eager to approve a loan, even with a bankruptcy on file. While stocks, real estate, and bonds all contribute to your net worth, lenders prefer to see cash in easy to access accounts, such as a savings or money market accounts.

Two months of living expenses in savings is the minimum for most financial companies require when offering sizeable loans. Increase that amount and you will see your loan rates drop. Add in a large down payment or salary, and you will qualify for even better terms.

Shop Around For Lower Rates And Fees

The best loan rates and fees are out there for those willing to do a little research. With most lending companies online, it's simple to find information on interest rates, terms, and fees. You can even request a free loan estimate without hurting your credit score.

With so many lenders offering financing for those with poor credit, it can be intimidating. So begin investigating companies that have been recommended. Broker sites are also a great way to collect information from a multitude of companies in one spot.