Rebuilding credit after a bankruptcy or credit consolidation process is not easy. You cannot do it instantly. It takes time, effort and discipline. But it is important to re-establish a solid, good credit history as fast as possible. The time this process takes really depends on you and the financial setback you have experienced.
Retain a Credit Card
Under certain situations, you can keep a credit card when faced with bankruptcy, consolidation or foreclosures, so long as you make the payments on time for that credit card. Once the financial situation has been resolved, on-time payments for this credit card will help build good credit.
New Credit Account
If all your credit accounts were closed, you need to open a new account to re-establish credit. In most cases you won't be able to open a regular unsecured credit account, so you will need to get a secured credit card. This type of card requires a cash deposit in the amount of credit limit being offered. This deposit offers the lender security as to the payment of the credit card balance, but after a certain time has passed, this deposit is returned to you. Once you have a credit card, make small credit charges and pay them off every month. This will start rebuilding your credit score quickly.
Timely Payments
Make all of your payments on time. This includes payments for utilities, rent, mortgage and credit cards. On-time payments increase your credit score, whereas late or missed payments will lower your score even more.
Credit Score
Pull your credit history every three months to six months to make sure payments are being reported and that all the information being reported is pertinent to your accounts. If anything is incorrect, report it immediately to get it removed from your credit history. Pull a report from all three credit reporting agencies, Experian, TransUnion, and Equifax, as not all credit reporting agencies have the same information.
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