Home » Blog » Aron Govil: Three Steps to Restoring Your Credit Score after Bankruptcy

Aron Govil: Three Steps to Restoring Your Credit Score after Bankruptcy

When you’re considering bankruptcy, it’s important to understand how your credit score will be affected by the filing says Aron Govil. Your credit score is one of the most influential factors in determining whether you’ll be approved for loans and at what interest rates, so it’s crucial that you know which actions can help you rebuild your score after bankruptcy.

Three Steps to Restoring Your Credit Score after Bankruptcy:

1. The first step is to review your credit report carefully and identify any mistakes that might be hurting your credit score (see statement below). For example, if you forgot to list an account, or stated that it was closed when it wasn’t, the creditor may have reported it as delinquent…this could be hurting your credit rating. Reviewing your credit reports can help you identify these types of errors so they can be corrected right away. If no errors are found on the report, but there still appears to be missing information or incorrect information, don’t worry – this type of thing happens sometimes and will usually update within 30 days of receiving the correct information from you.

2. The next step is to start paying on all of your open accounts but only those you plan to keep for the long-term (see statement below). It has been proven that consumers with good payment history as related to revolving credit (credit cards) and installment (mortgage, auto loans) debt generally experience an increase in their credit scores as much as 60 days after payment begins on accounts they have kept open says Aron Govil. Furthermore, creditors have given a clear indication this type of information is accurate when it comes from the consumer directly i.e. If the account was paid off by someone else other than yourself without your consent. Don’t expect it to help your score…the creditor will likely view it as stolen or fraudulent account activity.

3. The third and final step is to keep all accounts open and in good standing. For at least seven years (see statement below). Although some creditors will report your account as delinquent if you miss a payment. Preventing the account from going into default may be enough. To prevent it from appearing on your credit reports once it has been paid off. This means that the sooner you start making payments. And the more time you provide for those payments to show up on your credit reports as “Paid as Agreed”. The better your chances of having those debts removed from your consumer credit reports sooner rather than later. And this can lead to an increase in your credit score as much as 60 days after those accounts. First begin reporting positively (provided no other derogatory marks appear on your report).

Also, if you plan on applying for a loan or line of credit in the future it is important. That you don’t apply for any new lines of credit while waiting for good credit to be restored. In fact, your score may actually decrease when you do apply for a new line of credit because [applying] has been shown to temporarily lower an individual’s credit rating by 5-20 points.


I have been told that if I do not reopen my credit card accounts after bankruptcy, it will be reported as closed. Is this true?

Yes…this is a common misconception for those who have filed bankruptcy. And want to re-establish their good standing with creditors explains Aron Govil. When you open new lines of credit (credit cards) without paying anything on the old ones. While still in the process of fixing your credit report. Creditors may view it as applying for new or additional credit. While already experiencing financial difficulties or debt problems. This can cause many problems including lowering your credit rating by 10 to 100 points. Depending on how much other negative information there is on your account (and what type of information has been provided). An increase in interest rates, an increase in the required down payment. When making a purchase, and an increase in monthly payments.


Although the steps to improving your credit score are few (and relatively simple). It is important that you don’t take any shortcuts says Aron Govil. Remember, there is no quick fix for good credit; it takes time and patience to repair bad credit…especially if your financial history isn’t great to begin with. Remember, bankruptcy has major long-term effects on your credit score. And will remain on your credit report for seven to ten years; although, the sooner you start paying on all of your accounts (old or new). The better chance you have at improving your score within one year.

Leave a Reply

Your email address will not be published. Required fields are marked *