How To Rebuild Your Credit Rating After Bankruptcy?

How To Rebuild Your Credit Rating After Bankruptcy?

Congratulations! You’ve successfully served your 3 year period of bankruptcy and have been discharged, so what now? You’ve obviously taken the most suitable steps to address your financial difficulties by declaring bankruptcy, and all your debts are well behind you now. Keep in mind though, there’s still a considerable amount of work required to get your finances back in order. The major issue that discharged bankrupts face is their capability to borrow money, and the reason for this is their bad credit rating.


For the last 3 years, you’ve had no debts to repay so your credit history has nothing to show except for a bankruptcy mark against your name. There’s been no activity on your credit report, so an empty page will make lending institutions reluctant in lending money to you only because they can’t inspect your repayment behaviours. Repairing your credit rating is the best way to get your finances back on course, and make your recovery process as seamless as possible.


How you can repair your credit report after discharge?

Due to the fact that financial institutions haven’t been able to assess your financial management skills for the previous three years, you have to begin illustrating healthy financial habits. Here’s a list of ways in which you can do this


  1. Regular employment

Obtaining stable and ongoing employment is a fantastic way to increase your financial security and show lending institutions that you have a regular source of income. Steady employment will enable you to increase your savings and improve your overall financial condition, resulting in a better credit rating.


  1. Increase your savings balance

Your savings account is an asset, so increasing your savings balance with time will demonstrate to financial institutions that you are financially responsible and are capable of making loan repayments. By putting money into a dedicated savings account every month, even a small amount, will improve your credit rating.


  1. Limit your credit applications

Whenever you request a line of credit, it is documented on your credit history, so excessive credit applications can negatively affect your credit rating. After being discharged, it’s crucial that you are practical and cautious about the types of credit you apply for to increase the likelihood of approval. It’s best to make an application for only one line of credit at once, and remember that secured loans and options with a guarantor or joint accounts will increase the probability of approval.


  1. Think about a term deposit

If you’ve managed to save money throughout your bankruptcy period, consider putting some of it into a term deposit account. Not only will you accrue interest and strengthen your overall financial circumstances, it will also show loan providers that you are financially sensible. As a result, your chances of securing a loan will be increased which leads to an improved credit rating.


  1. Always make repayments on time

One of the most important things you can do as a discharged bankrupt is to make any type of repayment on time. Whether it’s your rent, electricity, or even a secured loan in your name, making these repayments on time will unquestionably improve your credit rating and increase the confidence that financial institutions have in your financial management abilities.


  1. Don’t hesitate to speak with financial institutions

If you want to apply for a line of credit after your bankruptcy period, or explore what types of options are available to you, don’t hesitate to speak to banks or other financial institutions to review your situation. They are in the best position to advise of your eligibility, and offer suggestions on what options would work best for your individual circumstances.


Be mindful of credit repair companies

There are a lot of credit repair firms that will make all kinds of promises to improve your credit report. While some of them are reliable in challenging any incorrect listings on your credit history, they may not be able to do anything else to improve your credit report. The Government’s MoneySmart website ( advises discharged bankrupts to be “very careful” of these agencies due to the fact that they “may not always be able to do what they claim they can”.


If you’re in need of any advice in repairing your credit report, or have any concerns about your recovery process after bankruptcy, it’s always best to seek advice from qualified professionals. Reach out to Bankruptcy Experts Tablelands on 1300 795 575, or alternatively you can visit our website for additional information: