For those in Maryland who are considering filing for personal bankruptcy, it is important to gain the proper perspective on how the process will affect your credit scores. Many consumers fear that bankruptcy will lead to permanent negative credit repercussions, but this is simply not the case. In fact, with the right degree of persistence and effort, it is possible to rebuild credit scores relatively quickly following consumer bankruptcy.

One way that individuals can increase their credit scores involves making careful and strategic choices in regard to opening new credit lines. Regardless of whether a line of credit is secured or unsecured, having several open lines of credit and making payments on time can result in an increased overall score. It is important, however, to ensure that the balance on those accounts does not exceed 10 to 30 percent of the total available balance.

Another tactic is to ask a close friend or family member with excellent credit to add you as an authorized user onto their existing accounts. Even if you never actually make use of the line of credit, you can benefit from the account holder’s responsible use of their available credit. This may take time, but it is an excellent tactic to add to your overall credit improvement efforts.

The bottom line is that consumer bankruptcy is not the financial death sentence that many in Maryland believe it to be. By eliminating the bulk of consumer debt through the discharge process, individuals will have more income available to rebuild financial stability. Rebuilding one’s credit score is an important part of that process.

Source: ABC News, 4 (Perfectly Legal) Hacks to Improve Your Credit Score, Christine Digangi, March 26, 2014