One of the many problems with bad debt is that it damages your credit. Missed payments, penalty fees and a delinquent account status can all take a toll on your credit score. The good news is that filing for bankruptcy can help.
Erasing Bad Debt
The Dayton bankruptcy process can give you a fresh start at credit recovery by erasing high debt balances and eliminating the delinquency status of your account. Having your debts discharged in bankruptcy provides a clean slate to rebuild, but it does take some effort on your part.
Now that your bad debts have been resolved, you have the chance to reestablish yourself as a responsible borrower. This means new credit and a new credit payment history. When looking for new credit, start at your credit report. Be sure that it is accurate and reflects your updated status for old accounts. If your report is incorrect, request that your information be updated before you start shopping for new lines of credit.
It is important that you pursue credit recovery with focus and patience. You don’t want just any line of credit, but one that you can successfully manage. Keep your spending limit low at first in order to gain a better interest rate. Plan your purchases ahead of time, making sure you can afford the payment each month. A quick way to boost your credit is to keep balances below 40 percent of the available limit, make consistent payments and carry zero balances for a few months before making another purchase. Remember that slow and steady wins the credit race!