If you manage your credit well after filing for bankruptcy, a FICO score in the 700s is possible. Here are steps you can take to improve your credit score and build a good credit score rating after a bankruptcy.
Step #1: Save money while you rebuild your credit. Having liquid assets also shows lenders you know how to manage money. Within just twelve months, by following this method, you will be working your way up on the FICO scale as well as be able to qualify for additional loans in larger amounts. Many online lenders specialize in servicing borrowers whose histories include bankruptcies, which translates to lower interest rates than you will find at your local bank.
Step #2: Keep your expenses and debt low. Lenders look at what your debt is relative to your income, to determine how risky you are. For example, with debt payments of $1,000 per month -- and income of $2,000 per month, your debt to income ratio would be 1,000/2000 or 50%. The lower your debt relative to your income, the better credit risk you are.
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