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Rebuild Your Credit With Oregon Credit Counseling

Although you may think your credit is "trashed" after filing bankruptcy, most people who file bankruptcy have already slipped into the "bad credit" zone. For them, it is easier after you complete your bankruptcy to obtain credit than it is just before you file. Bankruptcy is designed to give you a fresh start. There is a "servant/master" relationship between you and credit. Once you are the master, credit can be very useful. Oregon credit counseling can help you to rebuild your credit.

Why Rebuild Your Credit with Oregon Credit Counseling?

It is almost impossible to live a normal life in the United States without credit. You might find it unbelievable, but within a few months after filing bankruptcy, you will be receiving credit card offers in the mail. Within 6-12 months, most people can get a car loan at the same interest rate as anyone else if the person has paid the debts remaining after bankruptcy in a timely manner. Within 2 years, FHA, VA and other government mortgage lenders are required by government regulations to lend to you at the same interest rates as anyone else as long as you have paid debts on time after filing. Oregon credit counseling can help you to avoid making the same mistakes twice.

Follow These Oregon Credit Counseling Rules

  • Open a checking account and avoid "bouncing" your checks.
  • Apply for a secured credit card where you deposit cash and borrow against it. MAKE YOUR PAYMENTS ON TIME! Do not purchase consumables (food, gas and other things you will use up within a few days) with a credit card. You want to be able to pay off the purchase before the item is used up.
  • Apply for a personal loan with a co-signer.
  • When you are in need of a newer car, look for "bankruptcy friendly" dealers. You will pay a little more interest than someone with perfect credit, but there is financing available for you if you have a steady income. It is probably a good idea to buy a used car that is less expensive after filing bankruptcy. You take a big wallop in depreciation when you buy a new car and you will be "upside down" (owe more than the car is worth) as soon as you drive off the lot. Avoid this situation if at all possible.
  • You are entitled to put a statement into your credit report explaining why you had to file bankruptcy. If circumstances beyond your control were the cause, this should help.
  • Find a good source for a budget, spend time figuring out how to use it and then USE IT. Do not give in to the temptation to spend more than you have in income each month. Sometimes, it is just a matter of self discipline that will get you back on track.
  • NEVER get a "payday" loan.

Oregon Credit Counseling Credit Score Information

Oregon credit counseling can help you to better understand the principles behind credit. Creditors rely heavily in making credit decisions on your FICO score. Employers and insurance companies also use a FICO score to deny employment and to increase your insurance rates. FICO uses 5 factors. A "perfect" score is 1000. Here are how the 5 factors are used.

  1. Previous Credit History = 350 points (35%) - Your credit history is the largest factor in calculating your FICO credit score. It is obvious that by paying on time and not having any slow payments or charge offs, your score will increase.
  2. High Levels of Debt to Income = 300 points (30%) - If 40% of your income is going out on car and credit payments, your "debt to income ratio" is 40% and, by credit standards, you have no income left for new credit. If you have no debts, then your debt to income ratio will be 0% and your score will be higher.
  3. Limited Credit History = 150 points (15%) - The less credit history you have, the lower this part of your score will be.
  4. New Credit Applications = 100 points (10%) - Every time you apply for credit, it costs you money. Why? Because your credit score is reduced every time you apply for credit. When your credit score is reduced, when you do get credit, you will pay higher interest. Don't fall for that gimmick at Penneys of getting a $10 credit off a purchase if you apply for a credit card. It could cost you hundreds of dollars in the long run.
  5. Limited Types of Credit = 100 points (10%) - A variety of credit is better than having only one type of credit (like only car loans). You should try to have credit card, car and a home mortgage.

As you can see, there is a great deal to be learned from Oregon credit counseling. If you are looking to rebuild or improve your credit, Oregon credit counseling can help!

For more information regarding Oregon credit counseling, please Contact Us.

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