Clients file bankruptcy and then they want to know what to do to start rebuilding credit. That answer depends on the client and the chapter of bankruptcy that was filed.

If the client just filed a Chapter 13 then they cannot incur debt without first filing a motion with the court. However, if this motion is successful and they purchase some sort of secured property, the payments when reported to the clients credit will help to rebuild credit if payments are made on time, etc.

If a client filed a Chapter 7 then they have a few more options on rebuilding creditor. Similar to the Chapter 13 client, they can purchase a secured property such as a vehicle or house and the on time payments will help rebuild their credit. However, they do not have to file a motion to incur debt that the Chapter 13 client has to file. The Chapter 7 client can also get a secured credit card to help rebuild.

Something to keep in mind…. Anything you do that helps rebuild your credit can also damage your credit if payments are not made timely as originally agreed upon with the creditor. So rebuild but be careful to not be damaging credit further.