My husband and I experienced financial ruin like so many in the last few years. When the economy went into a tailspin, so did our credit scores. We had worked so hard to build up a good reputation and it seemed all was lost in just a few months. After talking to an attorney we decided bankruptcy was best for us.


The problem is that, while the bankruptcy might stop credit collectors and offer a fresh start, it does not help with your credit score. In fact the bankruptcy does  more damage to it. And, unfortunately, a terrible credit score can hinder more than your next big purchase – it can also keep you from some jobs or stop you from getting a decent rental. So what can you do to rebuild your credit?

First: Do not fall victim to fast fix credit repair companies. They are only going to take your money. Many of them will promise that they can remove all the negatives, but this is just not the case. They will also share with you the same tips I have below, but charge $500 or more in the process.

Second: Open a secured credit card. A secured credit card is the easiest and quickest way to start rebuilding your credit. Many experts say get two-three cards at the same time. You do not want to keep applying at different times because that can also put a ding on your report.

A secured credit card works by you applying a cash collateral deposit that becomes the credit line for that account. For example, if you put $500 in the account; you can charge up to $500. You may be able to add to the deposit to add more credit, or sometimes a bank will reward you for good payment and add to your credit line without requesting additional deposits.

We personally use one card for gas each month and the other for eating out. We pay the bill in full every month. The secured cards have very high interest rates and carrying a high balance would defeat the whole purpose.

Third: Sign up for a credit monitoring service. I personally use creditkeeper.com and it costs $10 every month. I am able to see what is reporting to the credit bureaus and how it shows up. They also monitor and send me alerts of any changes to my score.

If I notice anything that does not show up correctly, I simply send a letter to the credit bureau who is inaccurately reporting it explaining what is wrong and that I would like to dispute it. As long as you are being honest they will remove the error after validating your claim. It takes approximately 30-60 days and is a surprisingly easy process. It is also really important to make sure your name, address, and employer show up correctly you can also ask for this information to be updated.

From following these three simple steps my husband and I have already seen are credit scores improve greatly.