CIBIL: How to rebuild your credit score after bankruptcy? Here are 7 effective ways

livemint.com:

CIBIL score after insolvency, also known as bankruptcy, is a gradual process, but it’s certainly doable with disciplined financial habits. You need to review your credit report, clear your bills on time, keep your credit utilisation low. One of the key advices to follow is be patient as rebuilding credit score takes a long time.

Getting a regular credit card will be difficult, so you can apply for a secured credit card. Open a secured credit card: Secured credit cards are meant for individuals who have poor or no credit history. You'll need to give a security deposit, which serves as your credit limit.

Use the card responsibly by making small purchases and paying off the balance in full each month to demonstrate responsible credit usage. ALSO READ: What is the difference between hard and soft inquiries on your credit report? Apply for a credit builder loan: These loans are designed to help individuals build or rebuild credit. They typically have low borrowing amounts, and the lender holds the loan amount in a savings account.

When you make timely payments, your payment history is reported to credit bureaus, thus helping you improve your credit score. Become an authorised user: If you have a friend or family member with good credit, you can consider becoming an authorised user on one of their credit cards. Their positive payment history can boost your credit score.

Pay bills on time: Paying all your bills consistently, including utilities, rent, and loans, on time is important. Payment history is one of the most significant factors affecting your credit score. So, you can set up automatic payments to avoid missing due dates.