CREDIT REPAIR post bankruptcy


So you have filed. You have your discharge papers in hand. The fresh start begins, but everyone says no for new credit. If you decided to keep paying your car payment under good terms, you are already on your way to re-establishing.

It is highly recommended that you attend a seminar for obtaining a home loan! The tips are incredible and will have you on the right track.

The tips here are limited and not legal advice. They are from experience and my seminars. There are much more indepth classes and ideas.

If your goal is a home, please start working with your experienced loan officer two years in advance. Pick the bank you would like to work with and attend all their home buyer classes!



Take the time to compare the interest on 29% interest car loan with a 0% interest car loan over 60 months on a $25,000 car. check out these numbers:

car interest payment life of loan
$25,000 1% $427.37 $25642.20
$25,000 29% $793.55 $47613.00

The loan owner with bad credit pays nearly double for the same car!

So, it saves a great deal of money to rebuild the credit through other means than a car loan! Monthly expenses are dramatically lower and overall quality of life will be significantly improved by patiently rebuilding with another means besides a vehicle. This is one reason why people decide to keep their car during the bankruptcy. The terms seen agreed to are usually reasonable (8%) interest rate at the value or about the value of the car! Much better than surrender a car and purchasing another high interest car later!


Here is how I did it for my daughter. She turned 18 March 2012. I will not under any circumstances co-sign a loan for my children unless I intend to pay it in full. So, the two lines of credit she started with are:

1) Schwell's Furnture credit line approved $1000 - bought a small video camera. She owes $200 now and will most likely never purchase here again (paid about $200 for this line of credit over what she would have paid for the product cash).

2) Bronco Federal Credit shared loan - She put $500 put in a secured savings account. They loaned her back her own $500. She could spend the cash and pay it back in small monthly payments at 2% (yes 2%) interest, or she can put it in a savings account and have the bank make the payments on time for her! This line of credit runs about the same cost as a super sized meal at a fast food joint over the life of the loan.. and looks fabulous.
3) The one she will apply for, after the camera is paid off, is JC Penny.

4) When the shared loan is paid off, she will apply for a small personal loan, not shared, at the credit union.

When she is ready, if she ever wants to purchase a new vehicle, she will not have the enormous interest rates most people pay. They have 2% - 3% deals she can strive for.


Granted this process is much easier for the employed (wage earners), it does still work for self-employed.

The biggest error is applying everywhere and thinking someone will say yes. It hurts your credit score every time you inquire after the reasonable amount (which is only a few in a six months period).

The second error is getting a car at enormous interest right off the lot! You could try a private purchase car loan (newer cars, just not new) at a regular bank or credit union if you have some equity (or pay the cash to come up with the equity if the car is at value) to give them a safe investment. You can even build credit with the car you currently have title to in some cases.