Rebuilding Your Credit After Bankruptcy: A Step-by-Step Guide
By Robert Shelton, PLC – Saginaw, Michigan’s Fresh Start Expert
Serving Mid-Michigan with Compassion and Results
Bankruptcy gives you a fresh start, but rebuilding your credit takes effort. The good news? It’s absolutely possible—often faster than you think. At Robert Shelton, PLC, we’ve helped countless Saginaw residents file Chapter 7 and Chapter 13, and we’re here to guide you post-bankruptcy too. Follow these steps to get your credit back on track.
Step 1: Understand Where You Stand
Timeframe: Bankruptcy stays on your credit report for 10 years (Chapter 7) or 7 years (Chapter 13), but its impact fades over time.
Action: Get your free credit reports from AnnualCreditReport.com or Credit Karma(Equifax, Experian, TransUnion). Check for errors—discharged debts should show $0 balances. If not, you can file disputes through their website.
Tip: Don’t panic at a low score (e.g., 500–600 post-filing). It’s a starting line, not a finish.
Step 2: Pay Bills On Time, Every Time
Why: Payment history is 35% of your FICO score—the biggest piece.
How: Set up auto-payments for essentials (rent, utilities, phone).
Even small, consistent payments rebuild trust with lenders.
Michigan Insight: If you kept your house through Chapter 13, on-time mortgage payments boost your score fast.
Step 3: Start Small with Secured Credit
What: A secured credit card uses a cash deposit (e.g., $200) as your limit.
How: Apply at local banks or credit unions.
Use it lightly (e.g., gas only) and pay it off monthly.
Goal: Keep usage under 30% of the limit—$60 on a $200 card—to show responsibility.
Step 4: Consider a Credit Builder Loan
What: A small loan (e.g., $500–$1,000) you pay back over 6–12 months, often held in a savings account until paid.
Where: Check Wildfire Credit Union (Saginaw) or online lenders like Self.
Why: Adds “installment credit” to your mix, lifting your score alongside revolving credit (cards).
Step 5: Monitor and Grow
Tools: Use free apps like Credit Karma or Experian to track progress.
Next Steps: After 6–12 months of good behavior, try an unsecured card with a low limit. Avoid high-fee “subprime” cards—stick to reputable issuers like Capital One.
Timeline: Many clients hit 650–700 within 1–2 years with discipline.
Common Myths Busted
Myth: “Bankruptcy ruins credit forever.”
Truth: Scores can recover to “good” (670+) in 1–3 years with effort.
Myth: “I can’t get credit after filing.”
Truth: Secured cards and loans are designed for this—lenders want your business.
Bonus Tips from Robert Shelton, PLC
Budget Smart: Live within your means—use tools like Mint to avoid new debt.
Avoid Scams: Skip “credit repair” firms promising miracles for big fees. You’ve got this!
Ask Us: Filed with us? Call for a free post-bankruptcy check-in—we’re your Saginaw team.
Your Fresh Start Starts Here!
Bankruptcy isn’t the end—it’s a reset. With these steps, you’re not just rebuilding credit; you’re reclaiming control. Need help or have questions? Contact us:
Robert Shelton, PLC
Bankruptcy Law Office
(989) 401-4456
“Mid-Michigan’s Homegrown Fresh Start Lawyer”
Book Your Free Case Evaluation Now
Book Your Free Case Evaluation Now
If you are facing difficult financial obligations such as medical debt, credit card debt, foreclosure, or repossession contact us today. You don't have to be in financial ruin. The law allows financial assistance or even a fresh start.