If you are recovering from bankruptcy, you might be surprised to hear any suggestions relating to loans. However, the financial world can be an odd place. If you’ve gone through the bankruptcy process, you know this as well as anyone. So, don’t be surprised by this little piece of advice… taking on small loans after you’ve filed for bankruptcy can help you recover quicker. It’s true!
How Does it Work?
Really, the principle is quite simple. When you finish with the bankruptcy process, your credit score is not going to be good. And, that’s okay. It doesn’t mean that’s the way things will be forever. Of course, you want to build your credit score back up again so you can enjoy all of the benefits associated with a good score like low interest rates.
Building a score back up takes a little effort though on your part. It isn’t going to just happen on its own with any amount of time. When you are smart and strategic, you can build that credit score a lot faster. Here’s where loans come in. Taking on small loans and paying them back on time and in full will help re-establish you as a trustworthy borrower.
One word of advice though… don’t take out a loan if you aren’t fully confident about your ability to repay it. Failure to repay (or even just missing a single payment) is not something you want to deal with after finishing with bankruptcy. You’re in a delicate financial situation; take care of yourself!
Try this credit-building technique with small steps. You’ll be on your way to having a good score once again!