The toll that foreclosure can take on your life is devastating. From the turmoil of the process to the chaos of being uprooted from your home, there’s no doubt as to how overwhelming this event can be on your day-to-day routine. But that doesn’t even include what it can do to your credit score.
If you’re in the middle of this situation, you can start rebuilding your credit after foreclosure with these tips. And if you’ve already faced foreclosure, put these into practice now to build your credit score back up.
1. Think About the Cause and Adjust Your Finances
One of the best favors you can do for yourself is to figure out what caused the foreclosure and take steps to prevent those events from happening again. Should you have chosen a more affordable home? Managed your finances more meticulously? Adequately saved funds in the event of a job loss?
Whatever the case is, getting to the bottom of the problem will ultimately help you resolve your current situation and prevent future issues.
2. Pay your Bills on Time, Every Time
It’s possible that credit card companies will cancel your cards or boost your interest rate after foreclosure, but it isn’t a sure bet. If you’re in good standing, you can point to a long and consistent payment history to negotiate keeping your current terms.
Because credit will be harder to come by with a foreclosure on your record for the next 7 years, maintaining the credit you still have is crucial. Making payments on time and in full will also slowly but surely pull your credit score up over time.
3. Don’t Take On New Debt
But with that said, now is not the time to apply for new credit at every opportunity. Too many inquiries on your credit report in a short period of time can further damage it, extending the time you’ll have to wait to apply for another mortgage, card, or loan. When you’ve created a history of consistent payments you can show to creditors, they’ll be more likely to overlook the foreclosure in the future.
4. Monitor Your Credit Report
This is a good time to get a copy of your credit reports from each of the major credit bureaus (which you are freely entitled to once a year) and check for inaccuracies and inconsistencies. Disputing these will ensure that your credit score is not being further damaged by items you’re not responsible for.
Alternatively, you can order each credit report at a different time throughout the year to monitor how your credit is improving over time.
5. Sell Your Home For Cash
If you’re behind on your house payments and are planning out how you’ll recover once it’s all over, you can take a proactive step now and avoid foreclosure instead. When you sell your house to Local Cash Buyers, your credit starts rebuilding immediately as we take over the payments and your mortgage gets paid up to date. You won’t even have to worry about back taxes or going through the long process of a short sale.
Foreclosure is tough, but it doesn’t have to ruin your financial future forever. You can restore your credit score and even become a homeowner again with responsible, methodical steps. By being consistent and patient, your life and your finances will be able to bounce back.
Ready to walk away from your mortgage and begin repairing your credit now? Call us at 469-250-0018 or contact us online. We can make a written cash offer on your house within 24 hours and close within 7 to 10 days!